HireQuest proposes to acquire TrueBlue for $7.50 per share

GOOSE CREEK, SC - HireQuest Inc. (NASDAQ:HQI), a staffing solutions franchisor with a market capitalization of $142.5 million, has publicly announced its offer to purchase all outstanding shares of TrueBlue Inc. (NYSE:TBI) for $7.50 per share. This offer, made directly to TrueBlue’s Board of Directors, represents a 61% premium over TrueBlue’s closing stock price on May 12, 2025. According to InvestingPro analysis, HireQuest currently appears undervalued based on its Fair Value estimates.

The proposed transaction, which would be HireQuest’s 16th acquisition in the staffing industry, aims to leverage its high-margin franchising model to enhance profitability and shareholder value. With a remarkable gross profit margin of 100% and strong financial health indicators from InvestingPro, HireQuest has demonstrated its operational efficiency. HireQuest’s CEO, Rick Hermanns, emphasized the strategic nature of the acquisition and the value it could bring to shareholders of both companies.

HireQuest’s proposal is structured as an all-stock deal, offering TrueBlue shareholders the opportunity to invest in a combined entity with greater market leadership and potential for growth. Hermanns highlighted the need for TrueBlue, which has experienced a decade-long decline in revenue and profitability, to adopt HireQuest’s more flexible and efficient business model.

Despite repeated attempts over nearly two years, TrueBlue’s management and Board of Directors have not engaged with HireQuest on the proposal. The final offer letter, sent on May 9, 2025, suggests that HireQuest could consider adding a cash component or increasing the offer price if TrueBlue engages in negotiations.

HireQuest’s previous acquisitions have demonstrated its capability to integrate businesses successfully, converting traditional staffing branches into profitable franchises. The company’s approach is designed to adapt to changing economic cycles, which it believes could address TrueBlue’s challenges.

The offer is contingent on TrueBlue’s cooperation and is not subject to financing conditions. HireQuest has indicated readiness to pursue alternative transaction structures if TrueBlue prefers to remain independent, including the potential purchase of the PeopleReady, Inc. subsidiary.

The information presented is based on a press release statement, and the proposed acquisition remains subject to approval by TrueBlue’s Board and shareholders, as well as regulatory clearances. HireQuest maintains a strong financial position with a healthy current ratio of 2.18 and operates with a moderate debt-to-equity ratio of 0.08, suggesting financial flexibility for the transaction. For deeper insights into HireQuest’s financial health and growth prospects, including 10+ additional ProTips and comprehensive analysis, visit InvestingPro.

HireQuest operates staffing divisions across various industries, including construction, healthcare, and engineering, and aims to create a more comprehensive staffing provider through this acquisition. The transaction is expected to be a tax-free reorganization under IRC Sec. 368, allowing shareholders to potentially benefit from the combined company’s performance.

The press release includes forward-looking statements regarding the proposed transaction’s benefits and growth prospects, which are inherently uncertain and subject to change based on future developments.

In other recent news, HireQuest Inc. reported its financial results for the first quarter of 2025, revealing a challenging period for the company. The earnings per share (EPS) came in at $0.10, missing the forecasted $0.15, while revenue totaled $7.5 million, falling short of the anticipated $9.3 million. This underperformance reflects ongoing challenges in the staffing sector and macroeconomic conditions. Despite these setbacks, the company managed to maintain profitability, with a net income of $1.4 million and an adjusted EBITDA of $2.8 million, showcasing a 37% margin. The company has also highlighted its focus on mergers and acquisitions as part of its growth strategy, with a strong pipeline of potential deals. In terms of strategic management, HireQuest is leveraging enhanced immigration enforcement to gain a competitive advantage in staffing services. Additionally, the company has announced a CFO transition, with David Hartley set to succeed Steve Crane, a move that follows years of preparation and planning. Investors and analysts will be watching closely as HireQuest navigates these developments and the broader economic landscape.

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