Home Depot to buy back HD Supply in $8 billion deal

(Reuters) - Home Depot Inc said on Monday it would buy HD Supply Holdings Inc in a deal valued at about $8 billion, setting itself up to regain control over the industrial materials wholesaler after spinning it off over a decade ago. The top U.S

Reuters November 17, 2020 01:06:03 IST
Home Depot to buy back HD Supply in $8 billion deal

Home Depot to buy back HD Supply in 8 billion deal

(Reuters) - Home Depot Inc said on Monday it would buy HD Supply Holdings Inc in a deal valued at about $8 billion, setting itself up to regain control over the industrial materials wholesaler after spinning it off over a decade ago.

The top U.S. home improvement chain said it would offer $56 in cash for each share of HD Supply, a near 25% premium to the stock's last close. HD Supply's shares jumped 24.5% on the news.

With the deal, Home depot is looking to expand its reach into building utility and maintenance products, betting that the economic toll of the COVID-19 pandemic will force swathes of Americans to look for affordable housing.

"With a bolstered sales force and enhanced supply chain, we have no doubt Home Depot will be a more formidable player in the$55 billion maintenance, repair and operations market for years to come," Jefferies analysts wrote.

Home Depot, which sold HD Supply in 2007 for $8.5 billion to Bain Capital, Carlyle Group and Clayton, Dubilier & Rice, said it will fund the buy back through a combination of cash and debt.

HD Supply, one of the largest distributors of appliances, plumbing, and electrical equipment in North America with over 500,000 customers, is expected to be accretive to earnings in 2021, Home Depot said.

J.P. Morgan Securities LLC served as financial adviser to Home Depot on the deal, which is expected to close in its fourth fiscal quarter. The company will report third-quarter results on Tuesday.

(Reporting by Uday Sampath in Bengaluru; Editing by Shounak Dasgupta and Shinjini Ganguli)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

IAEA and U.S. pressure Iran over uranium particles at 'atomic warehouse'
World

IAEA and U.S. pressure Iran over uranium particles at 'atomic warehouse'

VIENNA (Reuters) - The U.N. nuclear watchdog and the United States pressured Iran on Wednesday to finally explain the origin of uranium particles found almost two years ago at an old but undeclared site that Israel has called a "secret atomic warehouse". Israeli Prime Minister Benjamin Netanyahu drew attention to the Turqazabad site in Tehran in a speech to the United Nations in September 2018, urging the International Atomic Energy Agency to visit it

Sri Lanka's Gotabaya says has reassembled nation's intelligence network
World

Sri Lanka's Gotabaya says has reassembled nation's intelligence network

NEW DELHI (Reuters) - Sri Lankan President Gotabaya Rajapaksa said on Wednesday he had delivered on a key election promise to rebuild the island nation's intelligence network in the year since assuming office.

Pole and Chinese citizen indicted in Warsaw for spying
World

Pole and Chinese citizen indicted in Warsaw for spying

WARSAW (Reuters) - Polish authorities said on Wednesday a former secret service agent and a Chinese citizen who worked for a telecommunications company have been charged with spying for China. Reuters previously reported on the allegations against an employee of Huawei and a former Polish domestic intelligence operative who were being investigated by the Warsaw government for suspected espionage