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Home Depot buys Interline Brands for $1.6bn

Home Depot store pic

Home Depot has agreed to purchase Interline Brands, a key US supplier of maintenance and repair products to businesses, property managers and contractors, for $1.6 billion in cash.

The deal is expected to bolster Home Depot’s sales to the professional building and repair market.

Home Depot, which is based in Atlanta, will acquire Interline from a consortium of investors that include Goldman Sachs’ private equity arm, P2 Capital Partners and Interline’s management. Goldman and P2 Capital acquired the company as part of a management buyout for $1.1 billion in 2012.

“Addressing the needs of our pro customers is a top priority for the Home Depot,” Craig Menear, the Home Depot chairman, chief executive and president, said in a news release. “With their seasoned leadership team, we will enhance our ability to serve the pro – both in the store and at any desired location outside of the store – driving significant value for our customers and shareholders.’

The transaction is subject to regulatory approval and is expected to be completed in Home Depot’s fiscal third quarter, which ends on Nov. 1.

Interline Brands, which is based in Jacksonville, Fla., serves more than 175,000 customers in the commercial, multifamily housing and residential contractor markets and has a distribution network of more than 90 locations in the Canada, Puerto Rico and the United States. It has more than 1,600 sales and support staff. The company reported sales of $1.6 billion for the 2013 fiscal year.

Separately, Home Depot said that Bill Lennie, the president of its Canadian operations, had been named to the newly created position of executive vice president for outside sales and service.

Mr. Lennie will oversee the company’s maintenance repair and overhaul, professional and installation services businesses, including the integration of Interline, Home Depot said. He will continue to head the Canadian business until a successor is chosen.

Bank of America Merrill Lynch and the law firm Cleary Gottlieb Steen & Hamilton advised Home Depot on the Interline transaction.

Source: New York Times.

Read more here.

22 July 2015

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