With the original proposal from QXO having expired on Monday, the company announced an extension of its deadline for the all-cash tender offer to acquire all outstanding shares of Beacon Building Supply at $124.25 per share. 

The offer now remains open until 5 p.m. EST on March 3, according to a QXO news release.

“As of 6 p.m. on February 24, approximately 10,685,631 shares of Beacon common stock — representing about 17.27% of all issued and outstanding shares — have been validly tendered and not withdrawn,” QXO stated. 

The company said the extension allows additional shareholders time to consider the offer and aims to facilitate the completion of the acquisition.

QXO Chairman and CEO Brad Jacobs emphasized that the deal represents “the only opportunity for Beacon shareholders to secure a substantial cash premium now.” 

He also criticized Beacon’s leadership, stating, “We’re confident Beacon investors will overwhelmingly support our offer if the Beacon Board removes its anti-shareholder poison pill.”

A QXO spokesperson dismissed a Beacon assertion that its shareholders are not interested in the QXO offer.  

"In fact, Beacon's board implemented a poison pill precisely to prevent shareholders from participating in the QXO tender offer — yet they did so anyway, in remarkable numbers," the spokesperson said. "If the Beacon Board truly believes its own rhetoric, it should remove the poison pill, allowing Beacon shareholders to make their own choice." 

QXO said it doubts Beacon's board will remove the measure as it fears " shareholders would overwhelmingly choose our offer."

The company again highlighted the quick close and available profit to be gained, noting that the transaction is not contingent on financing or due diligence conditions; the company has also secured antitrust clearance in the U.S. and Canada. 

In addition to the more than $5 billion cash on hand, QXO said financing commitments from major institutions, including Goldman Sachs, Morgan Stanley, and Wells Fargo, have been secured to cover the full purchase price and any required refinancing of Beacon’s debt.

Nevertheless, Beacon’s board of directors remains steadfast in its position against accepting the offer, continuing to discourage shareholders from tendering their shares. 

In a statement released Tuesday following QXO’s extension announcement, the company emphasized that QXO’s proposal "greatly undervalues the company and its potential for growth and value generation."

“Beacon has a strong track record of delivering above-market growth and superior financial and operational results through the successful execution of Ambition 2025,” the board stated. 

“Having generated total shareholder returns of more than 200% during the past five years under the current management team, the Board is confident that Beacon’s standalone plan will deliver substantially greater value than QXO’s proposal,” it continued.

The board also cited what it frames as a low percentage of shares tendered as proof that the offer does not meet shareholders’ expectations. 

“The fact that shareholders have only tendered approximately 17.27% of shares reaffirms that consistent with the Board’s view, the offer is at a price that the vast majority of shareholders believe does not adequately capture Beacon’s full intrinsic value,” the company said.

What Does ‘17%’ Mean?

Some aren’t as confident as Beacon’s board is about what that 17% figure means. 

Market analysts note that while 17% alone isn’t enough to win control, it represents a substantial foothold: nearly one-fifth of the company’s shares are already aligned with the bidder. 

This backing may indicate broader investor dissatisfaction with the board’s stance. With the deadline extended, that percentage could grow, possibly reaching the tipping point required for a change in control.

According to analysis from Bloomberg and Reuters, such early commitments often presage momentum shifts in proxy fights, suggesting that the board's position could become increasingly vulnerable if more shareholders follow suit.

QXO has stated that it remains committed to acquiring Beacon, with plans to transform it into a technology-forward leader in the $800 billion building products distribution industry. 

According to QXO’s release, the company is “targeting tens of billions of dollars in annual revenue over the next decade through accretive acquisitions and organic growth.”

Market Reacts

Analyst firms have weighed in on the developments, with Stifel downgrading Beacon from Buy to Hold and adjusting the target price to $122.55. Stifel cited the rejection of QXO's offer and the reduced likelihood of alternative bids. 

Conversely, RBC Capital Markets maintained an Outperform rating with a $130 price target, suggesting Beacon might present a strategic plan justifying a higher valuation when it holds its Investor Day summit next month in New York.

The RBC position, however, contrasts an equity research report produced earlier this month by Truist Securities, which stated that projections rarely sway investors over cash, writing, “While we believe these will be bullish, we have rarely seen long-term projections move sentiment on the stocks in our coverage.” 

With Beacon’s Q4 report due to be released ahead of the market open on Thursday, Feb. 27, Wall Street analysts expect the supplier to post quarterly earnings of $1.67 per share, according to Zacks Equity Research. 

That figure would indicate a 2.9% year-over-year decline. Revenues are expected to be $2.42 billion, up 5.4% from the year-ago quarter.

The consensus EPS estimate for the quarter has stayed the same over the past 30 days meaning, broadly, it shows how the analysts covering the stock have reevaluated their initial forecasts during this period.

Earnings estimate revisions should be considered before a company announces its earnings. As Zacks noted, it is a crucial indicator for forecasting potential investor behavior toward the stock. 

Numerous studies have shown a strong link between earnings estimate revision trends and a stock's short-term price movements.

Beacon’s Maginot Line

Beacon’s adoption of a poison pill strategy at the end of January is the defensive bulwark that may be its last line of defense, particularly if the March 13 Investor Day doesn’t pan out as planned. 

In this case, the strategy involves a short-term stockholder rights agreement, which offers one preferred share purchase right for each common stock share held by shareholders as of Feb. 7. 

This allows shareholders to purchase additional stock at a 50% discount, thus diluting the total number of outstanding shares that QXO needs to acquire, creating a challenge for Jacobs.

However, like the Maginot Line — a fortified defensive line built by France along its eastern border with Germany after World War I to deter future German aggression — the poison pill tactic could be rendered moot. 

Just as the Germans flanked the French fortification by invading through Belgium, if Beacon shareholders vote in favor of QXO’s proposed slate of directors at the company’s shareholder meeting this spring, the poison pill provision could be removed. 

As the March 3 deadline approaches, investors will weigh QXO's financial premium against Beacon’s long-term shareholder value creation claims. 

Both companies remain entrenched in their respective positions, with QXO pushing forward and Beacon pushing back.

Article updated at 12:14 p.m. on Feb. 25, 2025