QXO is already at it again.

With the dust still settling from the building materials distributor’s $11 billion purchase of Beacon, the company announced June 18 that it has made an offer to acquire GMS — North America’s largest independent distributor of drywall products.

QXO’s offer for publicly traded GMS is for $95.20 per share, which represents a deal value of approximately $5 billion and a 27% premium over GMS’ 60-day volume-weighted average share price.

“Our all-cash proposal to acquire GMS for $95.20 per share delivers immediate and certain value to GMS shareholders at a meaningful premium,” QXO Chairman and CEO Brad Jacobs said in news release. “We believe this is a compelling opportunity for GMS investors to realize the full value of their shares in a single, decisive transaction.”

Tucker, GA-based GMS was No. 9 on MDM’s newly-released Top Distributors List for Building Materials/Construction. Founded in 1971, the company has a network of more than 320 distribution centers to supply wallboard, ceilings, steel framing and complementary construction products. Across a portfolio of subsidiaries, GMS operates nearly 100 tool sales, rental and service centers that serve a residential and commercial contractor customer base in the U.S. and Canada.

Meanwhile, now with Beacon in tow, QXO is the largest publicly traded distributor of roofing, waterproofing and complementary building products in the U.S., and consistently notes its aggressive goal to achieve $50 billion in annual revenues over the next decade.

QXO Shares Letter Sent to GMS’ Leader

Along with its news release announcing the deal offer, QXO shared a letter sent from CFO Ihsan Essaid to GMS President and CEO John Turner that explained the rationale behind the offer and its terms.

QXO’s announcement came roughly 12 hours after GMS reported its financial results for its fiscal 2025 fourth quarter and full year that ended April 30. The company posted total 2025 sales of $5.5 billion — flat vs. 2024 — while organic net sales fell 5.8% against continued soft end market conditions. GMS’ 2025 adjusted EBITDA of $501 million fell 18.6% annually, while EBITDA margin of 9.1% trailed 2024’s 11.2%.

The letter leaned heavily into those downbeat figures to make a case for QXO’s offer.

Below are some key details and highlights from the letter:

• It acknowledges that Essaid met with Turner in New York City in May, and that QXO has been “studying” GMS for over a year.
• Essaid states: “We have no doubt that our offer will receive widespread support from GMS’ shareholders.”
• It acknowledges GMS’ “underwhelming financial performance that has been reflected in its share price and public market valuation.” Specifically, the letter notes that:
  • GMS’ EBITDA declined at a 4.0% annual rate over the last three years, compared to sector average of +4.6% in the same period
  • GMS’ EBITDA margin declined 315 basis points from fiscal 2022-2025 from 12.2% to 9.1% — a 26% decline — while market peers declined an average of 89 points in that period
  • GMS missed EBITDA, EBIT and EPS estimates in four of the past five quarters
  • “This performance has been frustrating for your shareholders,” Essaid wrote.
• QXO is ready to move quickly — noting two weeks of confirmatory due diligence (including management meetings) and is ready to move into a confidentiality agreement as long as it doesn’t include any standstill provisions that would prevent QXO from taking the offer directly to GMS shareholders 
  • MDM Insight: That note is of interest because it echos what Beacon did to delay QXO’s hostile takeover measure in its pursuit that eventual deal
• QXO requests that GMS responds to the offer by no latter than June 24. If not, QXO is ready to take its offer directly to GMS’ shareholders

“As we’ve said before, we don’t play games – we’re straightforward and we move fast. In that spirit we have put forth a highly compelling offer at the high end of our valuation range,” Essaid concluded. “We have the financial capacity and deal expertise to close the transaction swiftly and with a high level of certainty, and we’re willing to commit extensive resources to complete due diligence and negotiate definitive agreements on an accelerated timeframe. Our team and our advisors are standing by.”

Other Notes

As it was for the Beacon deal, QXO said Goldman Sachs & Co. and Morgan Stanley & Co. are acting as its financial advisors, while Paul, Weiss, Rifkind, Wharton & Garrison is acting as legal counsel.

MDM Insight: Despite the downbeat fiscals, GMS’ stock surged 12% during trading on June 18 prior to QXO’s announcement, which might signal that investors caught wind of it. GMS CEO John Turner provided optimistic comments about his company’s outlook for fiscal 2026, but not to the level that would warrant such a sharp one-day stock rise.

In its fiscal news release, GMS shared that on June 2, it completed an acquisition of Brooklyn Park, MN-based Lutz Company — a single-location distributor of exterior insulation finish systems, insulation board, tools and other products to the Minneapolis metro area. GMS also added greenfield locations in Owens Sound, Ontario in March and in Nashville, TN in June.