Lee County equipment supplier buys firm for $3.8B after previous deal collapses

A Bonita Springs business that posted nearly $3.6 billion in revenue last year has entered into a agreement to buy a Louisiana rental equipment company for $3.83 billion. 

Herc Holdings will acquire Baton Rouge-based H&E Equipment Services in a transaction expected to close in mid-2025, according to a statement. 

The deal comes after a twist: H&E had a prior merger agreement with a competitor of Herc, United Rentals, that it terminated. Herc paid a termination fee of more than $63.52 million on behalf of H&E, according to a statement.

The latest deal, of Herc buying H&E, was valued, in total, at $5.3 billion, including about $1.5 billion in debt, according to Reuters. United Rentals' bid, which also included debt, came in -9.4% under the Herc bid, at $4.8 billion bid, Reuters reports.

Herc offers earthmoving, material handling, aerial, compaction and lighting equipment as well as air compressors, trucks and trailers. It also provides other services and equipment for projects such as climate control, remediation and restoration and power generation. The company has more than 450 locations across North America and about 7,600 employees.

H&E Equipment Services’ fleet includes aerial work platforms, earthmoving, material handling and other general and specialty lines. It has more than 150 locations in over 30 states and posted more than $1.5 billion in revenue in 2024.

The merger will enable Herc to have a “larger, younger fleet” of equipment and “strengthens Herc’s position as the 3rd largest rental company in North America,” the statement says. The top two equipment rental companies are United Rentals and Sunbelt Rentals, according to global data firm Statista, which had H&E Equipment Services at No. 7.

“The acquisition of H&E is a unique opportunity to accelerate Herc’s proven strategy for industry-leading growth and delivering superior shareholder value,” Herc President and CEO Larry Silber says in a statement. “We have great respect for the H&E team and the high-quality platform they built. We look forward to welcoming H&E’s talented employees to Herc and working together to realize the substantial benefits that this transaction will create for the shareholders, employees and customers of both companies.”

These are some of the benefits of the agreement, according to the statement.:

• About $300 million of annual EBITDA synergies are expected within three years of the transaction’s close, including $125 million of cost synergies and $175 million EBITDA impact from revenue synergies.
• The transaction is expected to be high single-digit accretive to Herc’s cash earnings per share in 2026, ramping to over 20% as synergies are fully realized.
• Within three years of closing, the transaction is expected to generate return on invested capital beyond Herc’s cost of capital.

Under the terms of the merger agreement, H&E shareholders will receive $78.75 in cash and nearly 0.13 shares of Herc common stock for each share they own, with a total value of $104.89 per share, according to a statement, which says following the transaction’s close in mid-2025, H&E shareholders would own 14.1% of the combined company.