United leases $4.8 billion to acquire H&E equipment services

(Reuters) – United Rentals said on Tuesday it would acquire smaller rival H&E Equipment Services in a deal valued at $4.8 billion as the company looks to tap equipment rental demand.

Demand for industrial equipment from commercial construction firms remained strong due to higher government spending on infrastructure and production delays at manufacturers.

In the year Founded in 1961, H&E offers a complete rental fleet including aerial work platforms, earthmoving equipment, material handling equipment and other general and specialty equipment.

H&E shareholders will receive $92 in cash, United said, representing a 109.4% premium to the stock’s close on Monday.

“This acquisition of H&E supports our strategy to deploy capital to grow the core business,” said United Rentals CEO Matthew Flannery.

The merger will expand United’s rental fleet to about 64,000 units, the companies said.

United Rentals is one of the largest equipment rental companies in the world, with annual revenue increasing steadily over the past four years.

H&E Equipment’s share was up nearly 106% in premarket trading, while United rose 3%.

(Reporting by Abhinav Parmar and Nathan Gomez in Bengaluru; Editing by Krishna Chandra Elluri)