Home Depot has paid a premium of $25 per share to HD Supply’s Friday closing price. This deal with the Atlanta based distributor is valued at almost $8 billion.
“The (maintenance, repair and operations) 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,” said Craig Menear, chairman and CEO of The Home Depot. “HD Supply complements our existing MRO business with a robust product offering and value-added service capabilities, an experienced sales force that enhances the strong team we have in place, as well as an extensive, MRO-specific distribution network throughout the U.S. and Canada.”
Home Depot is the world’s biggest home improvement retailer. It expects to close the deal before its fiscal fourth quarter ends in January 2021.
HD Supply shares were marked 24.25 percent higher in pre-market trading Monday, after the takeover news. This indicates an opening bell price of $55.66 each. This all-time high will extend the stock’s gain by about 88 percent.
Ahead of its third quarter earnings on Tuesday, Home Depot shares were marked 1.25 percent higher at $280.55 per share.
Source: The Street