The Home Depot Acquiring Supplier to Professional Contractors
The Home Depot said yesterday it is acquiring SRS Distribution Inc. (SRS) -- a materials provider across several verticals serving professional roofers, landscapers and pool contractors -- in a deal valued at approximately $18.25 billion. It would be Home Depot's largest acquisition in its history. The home improvement retailer expects the acquisition to close this fiscal year, which ends in late January. It said it will finance the deal through cash on hand and debt. With this acquisition, The Home Depot said its total addressable market is approximately $1 trillion, an increase of approximately $50 billion.
The Home Depot said SRS will accelerate the retailer’s growth with the residential professional customer and will enable it to better serve complex project purchase occasions with the renovator/remodeler.
“SRS is an industry leader with a proven track record of profitable growth across verticals,” said Ted Decker, chair, president, and CEO of The Home Depot, in a statement. “SRS has built a robust and successful platform that will accelerate our growth with the residential professional customer while presenting future opportunities with the specialty trade pro.”
Decker continued, “SRS’s branch network, coupled with The Home Depot’s 2,000+ U.S. stores and distribution centers, comprehensive product offering, and extensive pro brands, provides the residential pro customer with more fulfillment and service options than ever before."
Based in McKinney, Tx., SRS operates a 760-plus branch network across 47 states. It also has a fleet of 4,000 delivery trucks, jobsite delivery capabilities and a dedicated 2,500-plus salesforce.
Total Retail's Take: This is a good move for The Home Depot. The company already draws half of its business from pros, and the acquisition will enable the company to gain even more of these customers who tackle complex and lucrative construction jobs, particularly as homeowners pull back on DIY projects. Over the past few quarters, customers have bought fewer big-ticket items and tackled smaller, less pricey projects.
The acquisition adds to other recent deals that the retailer has made in the pro space. They include the $8 billion acquisition of HD Supply, a national distributor of maintenance, repair and operations products in the multifamily and hospitality markets, in 2020. Last year, it also made two other acquisitions for undisclosed amounts: International Designs Group, which owns Construction Resources, a distributor of surfaces, appliances and other products that sells to home pros; and Temco, an appliance delivery and installation company.
- People:
- Ted Decker
