Beacon Announces Secondary Offering of 5,218,134 Shares of Common Stock

Rhea-AI Summary

Beacon (BECN) announced a secondary public offering of 5,218,134 shares of common stock by an affiliate of Clayton, Dubilier & Rice, LLC. RBC Capital Markets is the sole underwriter. After the offering, the selling stockholder will not hold any shares, and Beacon will not receive any proceeds. The total number of Beacon's shares outstanding will not change. The last reported sale price of Beacon's common stock was $84.12 per share. The offering will be made through various methods and is being conducted under Beacon's effective shelf registration statement on Form S-3ASR under the Securities Act of 1933.

Market Research Analyst

The secondary public offering of Beacon's common stock by CD&R Boulder Holdings represents a strategic move that may influence market perception of Beacon's liquidity and investor base. Secondary offerings often lead to a diversification of the shareholder base and can also provide an exit strategy for major investors. It is important to note that the offering does not dilute current shareholders since no new shares are being issued. However, the market's reaction to such offerings can be mixed, as they may signal that major investors are looking to reduce their positions, potentially leading to negative sentiment.

Moreover, the involvement of a reputable underwriter such as RBC Capital Markets may instill confidence in potential buyers regarding the stability and prospects of the offering. The transaction details, such as the offering at market or negotiated prices, suggest flexibility and responsiveness to market conditions, which could maximize the proceeds for the selling shareholder and minimize disruption to Beacon's stock price.

Financial Analyst

From a financial perspective, the sale of 5,218,134 shares by CD&R Boulder Holdings is a significant liquidity event that does not impact Beacon's capital structure since the proceeds do not go to the company. The last reported sale price provides a reference point for the market, but investors will be closely monitoring the actual sale prices in this offering. The secondary offering could potentially put downward pressure on Beacon's stock price in the short term due to the increased supply of shares available for purchase.

Long-term implications for Beacon's stock will largely depend on the market's interpretation of CD&R Boulder Holdings' decision to divest its entire stake. If seen as a lack of confidence by a major investor, it could lead to a longer-term negative impact. Conversely, if the market views this as a regular portfolio rebalancing by CD&R Boulder Holdings, the impact may be more muted.

Legal Expert

The legal framework governing this transaction, particularly the use of a shelf registration statement on Form S-3ASR, indicates that Beacon had previously filed the necessary documentation with the SEC to allow for rapid execution of such offerings. This type of registration is commonly used by well-established companies and allows for the sale of securities to the public without the need for a lengthy and separate registration process for each offering.

The requirement for a prospectus and prospectus supplement ensures transparency and provides investors with detailed information regarding the offering. Compliance with the Securities Act of 1933 is crucial to avoid regulatory issues and maintain investor confidence in the process. The legal intricacies of such transactions are essential for maintaining the integrity of the markets and protecting investor interests.

HERNDON, Va., Jan. 18, 2024 /PRNewswire/ -- Beacon (NASDAQ: BECN) ("Beacon") announced today the commencement of an underwritten secondary public offering of 5,218,134 shares of Beacon's common stock by CD&R Boulder Holdings, L.P., an entity affiliated with Clayton, Dubilier & Rice, LLC. RBC Capital Markets is acting as the sole underwriter in the registered public offering of those shares.

Following the completion of this offering, the selling stockholder will not hold any shares of Beacon common stock. Beacon is not selling any shares of common stock and will not receive any proceeds from the offering. The total number of Beacon's shares outstanding will not change as a result of the offering.

The last reported sale price on the Nasdaq Global Select Market of Beacon common stock on January 17, 2024 was $84.12 per share. RBC Capital Markets proposes to offer for sale the shares of Beacon common stock from time to time in one or more transactions on the Nasdaq Global Select Market, in the over-the-counter market, through negotiated transactions or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices, subject to receipt and acceptance by it and subject to its right to reject any order in whole or in part.

The offering of these shares is being conducted as a public offering pursuant to Beacon's effective shelf registration statement on Form S-3ASR under the Securities Act of 1933, as amended. The proposed offering will be made only by means of a prospectus and prospectus supplement that will form part of the effective registration statement relating to the offering. Information about the offering is available in the preliminary prospectus supplement being filed today with the U.S. Securities and Exchange Commission (the "SEC"). Copies of the preliminary prospectus supplement and the accompanying prospectus relating to the offering, and the final prospectus supplement, when available, may be obtained by contacting RBC Capital Markets, LLC, Attention: Equity Syndicate, 200 Vesey Street, 8th Floor, New York, New York 10281, or by telephone at (877) 822-4089, or by email at equityprospectus@rbccm.com or by visiting the SEC's website located at www.sec.gov. You should read the preliminary prospectus supplement and the accompanying prospectus and other documents Beacon has filed with the SEC for more complete information about Beacon and this offering.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Forward-Looking Statements

This press release contains information about management's view of Beacon's future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including, but not limited to, those set forth in the "Risk Factors" section of Beacon's latest Form 10-K and subsequent filings with the SEC. In addition, the forward-looking statements included in this press release represent Beacon's views as of the date of this press release and these views could change. However, while Beacon may elect to update these forward-looking statements at some point, Beacon specifically disclaims any obligation to do so, other than as required by federal securities laws. These forward-looking statements should not be relied upon as representing Beacon's views as of any date subsequent to the date of this press release.

About Beacon

Founded in 1928, Beacon is a Fortune 500, publicly traded distributor of building products, including roofing materials and complementary products, such as siding and waterproofing. The company operates over 500 branches throughout all 50 states in the U.S. and 6 provinces in Canada. Beacon serves an extensive base of nearly 100,000 customers, utilizing its vast branch network and diverse service offerings to provide high-quality products and support throughout the entire business lifecycle. Beacon offers its own private label brand, TRI-BUILT®, and has a proprietary digital account management suite, Beacon PRO+, which allows customers to manage their businesses online. Beacon's stock is traded on the Nasdaq Global Select Market under the ticker symbol BECN. To learn more about Beacon, please visit www.becn.com.

INVESTOR CONTACT
Binit Sanghvi
VP, Capital Markets and Treasurer
Binit.Sanghvi@becn.com
972-369-8005

MEDIA CONTACT
Jennifer Lewis
VP, Communications and Corporate Social Responsibility
Jennifer.Lewis@becn.com
571-752-1048

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SOURCE Beacon Roofing Supply, Inc.

What is the purpose of the secondary public offering announced by Beacon (BECN)?

The purpose is to offer 5,218,134 shares of Beacon's common stock for sale by an affiliate of Clayton, Dubilier & Rice, LLC.

Who is the sole underwriter for the offering?

RBC Capital Markets is acting as the sole underwriter for the offering.

Will Beacon receive any proceeds from the offering?

No, Beacon will not receive any proceeds from the offering.

What was the last reported sale price of Beacon's common stock?

The last reported sale price was $84.12 per share.

Under what registration statement is the offering being conducted?

The offering is being conducted under Beacon's effective shelf registration statement on Form S-3ASR under the Securities Act of 1933.