FX.co ★ Home Depot To Buy SRS Distribution For $18.25 Bln

On Thursday, Home Depot Inc., an eminent home improvement retail chain, announced that it has embarked on a venture to acquire SRS Distribution Inc. SRS is well-recognized as a residential specialty distributor catering to professional roofers, landscapers, and pool contractors. As per the agreement, Home Depot's subsidiary will purchase SRS for an estimated $18.25 billion, which includes net debt.

Home Depot plans to wrap up the transaction by fiscal year 2024's end, using available cash and incurring additional debt to fund the acquisition.

Ted Decker, CEO of Home Depot, spoke highly of SRS's platform, stating that it would bolster Home Depot's growth within the residential professional customer demographic. Additionally, he pointed out the potential future opportunities associated with the specialty trade professional.

From a financial standpoint, this acquisition is projected to reduce Home Depot's net income per share due to amortization expenses. Still, it is expected to be cash earnings per share (EPS) accretive in the first year, post-closing, disregarding synergistic effects.

Following the completion of the transaction, Home Depot anticipates its total addressable market size to be approximately $1 trillion, a significant jump of $50 billion.

Before the opening of the New York Stock Exchange, Home Depot's shares were trading at $382.91, marking a 0.77 percent decrease.