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Home Depot to Acquire HD Supply

Big-box retailer Home Depot has announced plans to acquire HD Supply Holdings Inc., a leading national distributor of maintenance, repair and operations (MRO) products. The acquisition is expected to position Home Depot as a lead supplier of MRO products, the company notes in a press release.

“The MRO customer is highly valued by Home Depot, and this acquisition will position the company to accelerate sales growth by better serving both existing and new customers in a highly fragmented $55 billion marketplace,” says Craig Menear, chairman and CEO of Home Depot. “HD Supply complements our existing MRO business with a robust product offering and value-added service capabilities, an experienced salesforce that enhances the strong team we have in place, as well as an extensive, MRO-specific distribution network throughout the U.S. and Canada.”

“We’re thrilled that our associates are joining the Home Depot team and that our customers will be able to benefit from a broader product assortment, expanded delivery options and enhanced services nationally,” says Joe DeAngelo, chairman and CEO, HD Supply. “We are confident that this will position both Home Depot and HD Supply for continued growth and success in the MRO distribution space.”

According to the acquisition agreement, a Home Depot subsidiary will start a cash tender offer to purchase all outstanding shares of HD Supply common stock at $56 per share for a total value of roughly $8 billion.

“We plan to access the debt capital markets to raise incremental indebtedness in support of this acquisition. We also expect the transaction to be accretive to earnings in fiscal 2021, with potential for significant shareholder value creation over the longer term,” says Richard McPhail, Home Depot executive vice president and CFO.

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