Nesco Holdings, Inc. (NYSE: NSCO) stock is surging 60.00% to $6.96 in the morning session today following announcement that it has entered into a preliminary agreement to acquire Custom Truck One Source for $1.475 billion. Nesco and CTOS are leading manufacturers of customized solutions for trucks and heavy vehicles, including leasing, distribution, aftermarket parts, and operation.
The merger would create a leading, one-stop-shop specialty rental equipment retailer targeting increasingly lucrative and rising end markets in infrastructure, including transmission and storage, the 5G build-out revolution, and vital rail and other national infrastructure initiatives.
The integration is expected to deliver substantial advantages with complementary business lines, client bases, and skills from the greater scope, range of products and services, and extended regional coverage.
After closure, the merged entity would have a more favorable financial structure with greatly decreased debt and expanded profitability, offering stability to satisfy projected demand in the broad and increasing addressable sector in which it operates.
With the deal, a Platinum Equity, LLC partner. In return for newly issued common stock at a $5.00 per share, it has agreed to invest over $850 million in Nesco.
Also, former CTOS owners, including certain funds controlled by The Blackstone Company, Inc. are expected to spend roughly $100 million in Nesco in return for newly issued common stock at the same price as Platinum, in their capacity as the actual majority owner of CTOS, and certain members of the CTOS management team.
Besides, former CTOS owners, including certain funds controlled by The Blackstone Company, Inc. are expected to spend roughly $100 million in Nesco in return for newly issued common stock at the same price as Platinum, in their capacity as the actual majority owner of CTOS, and certain members of the CTOS management team.
