Atlanta-Based The Home Depot Acquires Key Competitor for $8 Billion

Home improvement retailer this week finalized the HD Supply deal, first announced in mid-November
Atlanta-Based The Home Depot Acquires Key Competitor for $8 Billion
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Atlanta-based home improvement retailer The Home Depot has completed the acquisition of HD Supply Holdings, Inc. for a total enterprise value — including net cash– of approximately $8 billion, according to a press release Thursday. HD Supply is a national distributor of maintenance, repair, and operations (MRO) products in the multifamily and hospitality end markets. The agreement to acquire HD Supply was first announced on November 16, 2020.

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“We’re thrilled to welcome HD Supply associates to The Home Depot,” Craig Menear, chairman and CEO of The Home Depot, said in the announcement. “The combination of the two businesses will enable us to better serve both existing and new MRO customers, and I look forward to the value this acquisition will bring to our associates, customers and shareholders.”

HD Supply is one of the largest wholesale distributors in North America. The company provides a broad range of products and value-add services to approximately 300,000 customers with leadership positions in the living space maintenance, repair, and operations sector. It operates approximately 44 distribution centers across 25 states and two Canadian provinces and has 5,500 associates.

HD Supply is also an Atlanta-headquartered company. It opened its Atlanta headquarters in 2018, at 3400 Cumberland Boulevard SE. The $100 million headquarters broke ground in 2016 and houses 1,000 employees.

“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,” Joe DeAngelo, chairman and CEO of HD Supply, said in a prepared statement when plans for the acquisition were first announced in November. “We are confident that this will position both The Home Depot and HD Supply for continued growth and success in the MRO distribution space.”

The tender offer for all of the outstanding shares of HD Supply expired at midnight, New York City time, at the end of the day on December 23, 2020American Stock Transfer & Trust Company, LLC — the depository and paying agent for the tender offer — advised The Home Depot that as of the tender offer expiration, a total of 127,928,897 shares had been validly tendered and not validly withdrawn, representing approximately 82.9 percent of the outstanding shares. All of the conditions of the offer have been satisfied and The Home Depot and its subsidiary Coronado Acquisition Sub Inc. have accepted for payment for $56 per share in cash, without interest, subject to any required withholding taxes, all shares validly tendered and not validly withdrawn and will promptly pay for all such shares. 

Following its acceptance of the tendered shares, The Home Depot completed the acquisition of HD Supply through a merger of Coronado Acquisition Sub Inc. with and into HD Supply. As a result of the merger, HD Supply became a wholly-owned subsidiary of The Home Depot. In connection with the merger, all HD Supply shares not validly tendered (other than shares held by The Home Depot, Coronado Acquisition Sub Inc., HD Supply, or any of their respective direct or indirect wholly-owned subsidiaries and shares held by stockholders of HD Supply who have perfected their statutory appraisal rights) have been canceled and converted into the right to receive the same $56 in cash (without interest and subject to any required withholding taxes) as will be paid for all HD Supply shares that were validly tendered and not validly withdrawn. 

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

Caleb J. Spivak

Caleb J. Spivak (CJS) is the Founder of What Now Media Group, Inc., the publisher of What Now Atlanta, What Now Los Angeles, What Now San Diego, and What Now Las Vegas.
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Former Resident
21 days ago

HD Supply was previously a Home Depot division which they spun off when regular Home Depot stock wasn’t minting cash like they wanted. Now, they’ve paid a lot of money to buy back what they used to own. It really never should have been spun off but on the other hand, it let HD find their own way forward and made for a stronger business. Anyway congrats on getting the family back together again.

21 days ago

Hope Home Depot won’t screw this up again this time around.

19 days ago

Don’t like anything to do with home Depot bad customer service very bad personal experience with that co. Would never do any business with them again

21 days ago

HD Supply – good customer service. HD Supply – bad at packing products for shipping. 2x I ordered the same thing – both times the item was damaged because of poor packaging.

B Geer
21 days ago

Who cares. I never shop homedepot. Horrible company.

20 days ago
Reply to  B Geer

Lowe’s is a much better customer oriented company.

21 days ago

how many times can Home Depot do this? Maintenance Warehouse sends best regards

20 days ago
Reply to  Will Pollock

HD Supply is Maintenance Warehouse. Home Depot bought MW and changed its name to HDSupply

20 days ago

As a local driver for hd . I see home depot expanding delivery during this pandemic. We can hardly deliver what we get now and I see this as just a market grab. What happens after pandemic? And delivery sales go down . Sell it again like the last time when shares fell.

19 days ago

I realize this is basically a press release, but I am disappointed that the writer of this story left out the fundamental piece of news that HD Supply used to be part of Home Depot, and that Home Depot is buying it back. I do enjoy this website, but that is a major flaw in this article.

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