Lowe’s Completes Orchard Supply Hardware Acquisition
Lowe’s Companies, the world’s second largest home improvement retailer, announced completion of its acquisition of the majority of assets of Orchard Supply Hardware, including 72 Orchard stores, for approximately $205 million in cash. The acquisition includes assumption of payables owed to nearly all of Orchard’s supplier partners. Orchard will continue to operate as a separate, standalone business, retaining its brand and its San Jose headquarters.
Goldman Sachs acted as financial advisor, and Hunton & Williams acted as legal advisor.
The acquisition expands Lowe’s presence in California through the addition of Orchard’s smaller-format neighborhood stores, which are a complement to Lowe’s strengths in big-box retail.
“We look forward to a smooth transition and to continuing the successful repositioning strategy already underway to take full advantage of Orchard’s growth potential,” said Richard D. Maltsbarger, Lowe’s business development executive and president of Orchard. “Orchard is well-positioned within the California marketplace, with a strong brand, loyal customers and significant opportunity to benefit from the economic recovery. We are confident Orchard has a bright future as part of Lowe’s.”
Located in high-density, prime locations that are difficult for larger format retailers to enter, Orchard’s smaller-format neighborhood stores offer a product selection focused on paint, repair and backyard categories in approximately 36,000 square feet of selling space, compared to 113,000 square feet of selling space for an average Lowe’s home improvement store.
With fiscal year 2012 sales of $50.5 billion, Lowe’s is a FORTUNE® 100 company that serves approximately 15 million customers a week at home improvement and hardware stores in the United States, Canada and Mexico.
Previously on abfjournal: Great American Begins Liquidating Nine Orchard Stores, August 26, 2013