United Rentals Inc., the world's largest construction equipment rental company, will buy Neff Corp. for about $1.3 billion, the companies said, topping H&E Equipment Services Inc's about $1.2 billion offer last month.
United Rentals will pay $25 per share, representing a 26.9 percent premium to Neff stock price prior to H&E's July 14 deal.
Construction equipment rental chain Neff said on Monday it had received a "superior offer", trumping H&E's offer of $21.07 per share.
United has paid H&E a fee of about $13.2 million for terminating the Neff deal, United said in a statement on Wednesday.
H&E said earlier on Aug. 16, it did not intend to submit a revised offer, sending Neff shares down 6 percent.
Stamford, Connecticut-based United is an equipment rental company that serves construction companies, utilities, municipalities and homeowners.
"United Rentals is an industry leader in equipment rentals, and as a result of this transaction, our employees and customers will benefit from the combined company's expanded geographic footprint and diversified offering," Neff's Chief Executive Graham Hood said.
Neff is expected to generate $419 million of total revenue for the full year, the companies said.
Morgan Stanley & Co LLC and Centerview Partners were financial advisers to United Rentals, while Deutsche Bank advised Neff.
The deal is expected to immediately add to cash earnings per share and free cash flow generation.
Source: Rueters
