United Rental pays $965 million for NES

Equipment lending giant United Rental is paying approximately $965 million in cash to acquire NES, one of the ten largest general equipment rental companies in the US which specializes in providing aerial equipment to approximately 18,000 customers across the industrial and non-residential construction sectors.

The board of directors of United Rentals and Diamond Castle Holdings, the majority owner of NES, unanimously approved the agreement. The transaction is expected to close early in the second quarter of 2017.

Based in Chicago, NES has 73 branches and approximately 1,100 employees, with a concentration in the eastern half of the US. In 2016, NES generated an estimated $155 million of EBITDA at a 42.1% margin on $369 million of total revenue. As of December 31, 2016, NES had approximately $900 million of fleet at original equipment cost.

United Rentals says the addition of NES’s branch footprint will increase the company’s density in strategically important markets, including the East Coast, Gulf States and the Midwest.

Michael Kneeland, president and chief executive officer of United Rentals, said: “This exciting transaction will augment our revenue, earnings, EBITDA, free cash flow and overall scale, and expand our base of local and strategic accounts at a key point in the demand cycle.”