WASHINGTON – North American hardware retailer The Home Depot on Monday announced plans to re-acquire wholesaler HD Supply Holdings in an US$8 billion (RM32.84 billion) deal set to close early next year.
The announcement comes ahead of The Home Depot's third-quarter earnings release on Tuesday.
The company’s profits surged 24.5% in the second quarter to US$4.3 billion as consumers, home-bound during the coronavirus pandemic and assisted by US government stimulus payments, invested in improvements to their properties.
Wholesale distributor HD Supply operates distribution centers in the United States and Canada, and was formerly a unit of The Home Depot before being sold in 2007.
“This acquisition will position the company to accelerate sales growth by better serving both existing and new customers in a highly fragmented US$55 billion marketplace,” said chief executive officer Craig Menear in a statement.
Under the deal’s terms, The Home Depot will purchase all of HD Supply's stock for $56 a share by raising new debt and using cash on hand, with the sale set to be finalised at the end of the company's fiscal quarter finishing on January 31, according to the statement.
“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,” said HD Supply’s chief executive officer Joe DeAngelo.
HD Supply surged 24.2at the open of US trading. Home Depot was up 0.6%. – AFP, November 17, 2020
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