by Anirban Sen
LONDON (Reuters) – Billionaire Brad Jacobs’ QXO recently made an 8.46 billion euro ($9.37 billion) bid to buy Rexel, but the French company said on Sunday it had rejected the proposal.
QXO’s preliminary offer, which amounted to 28.40 euros per share, “significantly undervalues the group and does not reflect its potential for value creation through its strategic plan “Power Up 25”, Rexel wrote in a press release.
“The Board of Directors remains very confident in the ability of Rexel’s management to achieve the medium-term objectives presented,” the press release continues.
Reuters, citing sources, had earlier reported that Rexel had rejected QXO’s 8.46 billion euro proposal.
QXO has no immediate plans to improve its offer, a source familiar with the situation told Reuters.
Rexel shares closed on Friday on the Paris Stock Exchange at 22.97 euros, giving it a market capitalization of nearly 11 billion euros, including debt.
The attempted takeover of the French electrical equipment specialist in the construction sector is the first major one for QXO since its chairman, Brad Jacobs, set out to use the group as a vehicle to acquire companies in the sector. It would also have been one of the largest transactions in France by a foreign group in recent years.
QXO, which is valued at $6 billion, announced in July that it had raised $620 million, increasing its cash position to about $5 billion. The group is debt-free, giving it significant room to pursue expansion deals.
QXO, formerly known as Connecticut-based SilverSun Technologies, has been in talks with Rexel and its largest shareholder, Cevian Capital, about a possible acquisition, the people said. Cevian owns 22.9% of Rexel, according to LSEG data.
Jared Kushner, the son-in-law of former US President Donald Trump, sits on QXO’s board of directors.
The American group also recently recruited Ihsan Essaid, former global head of mergers and acquisitions at Barclays, as its chief financial officer.
(Report by Anirban Sen, with contributions from Mathieu Rosemain in Paris; by Claude Chendjou)
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