Home Depot will buy maintenance and repair distributor HD Supply Holdings.
HD Supply is a sells hardware, tools, appliances, cleaning supplies and more to multifamily, hospitality, and commercial properties as well as customers in healthcare and government facilities. The deal is a reunion for the two companies and the second time Home Depot has acquired the company.
The company was founded in 1974 as the Maintenance Warehouse and was acquired by Home Depot in 1997. In 2004, Home Depot changed the company’s name to The Home Depot Supply. The company was then merged with Hughes Supply in 2007 under the new name of HD Supply. That same year, Home Depot sold the company to private equity firms Bain Capital LLC; Carlyle Group; and Clayton, Dubilier & Rice.
Home Depot says this most recent acquisition is expected to position it as “a premier provider in the maintenance, repair and operations (MRO) marketplace.”
“The MRO customer is highly valued by The 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, 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 are confident that this will position both The Home Depot and HD Supply for continued growth and success in the MRO distribution space,” says Joe DeAngelo, chairman and CEO, HD Supply. HD Supply has 44 distribution centers in 25 states and two Canadian provinces.
Home Depot is making a cash tender offer to purchase all outstanding shares of HD Supply common stock for approximately $8 billion. The deal is expected to be completed in Home Depot’s fiscal fourth quarter, which ends on Jan. 31.