QXO Inc., the digital distribution firm founded by logistics mogul Brad Jacobs, has offered $5 billion in cash to acquire GMS Inc., aiming to accelerate its push into tech-enabled building materials distribution.
The unsolicited bid, valued at $95.20 per share, represents an 18% premium over GMS’s most recent closing price and 27% above its 60-day average. It follows QXO’s multibillion-dollar acquisition of Beacon Roofing Supply earlier this year. It also marks another bold move to consolidate the fragmented $800 billion building products market under a digitally unified platform.
Jacobs launched QXO in 2023. He who previously built XPO, GXO, and RXO. QXO aims to create a scaled, digital operating model across construction supply. The firm said it has financing commitments from Goldman Sachs and Morgan Stanley and is prepared to close the GMS deal swiftly. If GMS’s board does not engage, QXO may take its offer directly to shareholders.
QXO offer to acquire GMS
In a letter to GMS’s board, QXO pointed to the company’s weakening margins and underperformance, despite years of investment in digital infrastructure.
“GMS has underdelivered,” Jacobs wrote, calling the company’s ecommerce execution “unrealized potential.” He positioned QXO’s offer as “a clear and immediate path to value creation.”
GMS is a distributor of wallboard, ceilings, and other specialty building materials. It has modernized key parts of its business in recent years. Its MyGMS portal offers digital ordering, mobile access, real-time pricing, delivery tracking, and billing tools tailored for contractors in the field.
“Our ecommerce strategy is critical to how we support our customers,” said CEO John C. Turner, Jr., during the company’s latest earnings call, touting digital accessibility as a customer differentiator.
But GMS has hit headwinds. For its fiscal fourth quarter ending April 30, revenue fell 5.6% to $1.33 billion, and net income sank to $26.1 million — less than half of last year’s $56.4 million. Full-year net income dropped 58% as both residential and commercial construction demand weakened.
To counter the slump, GMS has pursued cost controls and small acquisitions, including Kamco Supply Corp. of New England, which bolstered its ceiling sales and ecommerce fulfillment in the Northeast.
“Kamco contributed positively,” Turner said, pointing to its digital capabilities.
GMS confirmed receipt of the proposal and said its board, with guidance from Jefferies and Alston & Bird, will evaluate the bid.
“GMS shareholders do not need to take any action at this time,” the company stated.
As digital transformation continues to reshape the construction supply chain, QXO’s move underscores the increasing pressure on distributors to scale, automate, and compete on experience — both in the field and online.
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