Home DepotThe largest company in the DIY enthusiast on the Fortune 500leans into a customer base of the contractor, Announce Monday The acquisition of special construction products distributor GMS for around 4.3 billion US dollars.
According to the company, the creation of GMS helps to increase the Professional Contracting (Pro) Berosen, which was also held by the 2024 special trade by the acquisition of the SRS of the Home Depot. According to the company’s announcement, this has contributed to consolidating the Heimdepot as a leading retail retail for roof, landscaping and pool supplies.
While analysts say that the acquisition of GMS through Home Depot has contributed to accelerating the position of the company as a leading dealer for construction products, the company may have paid too much for do -it -yourselfers.
Although the “strategic justification with additional scale, category width and delivery functions” is solid, Home Depot paid 11 times the GMS -bitda (profits before interest, taxes, depreciation and amortization), wrote analysts of Raymond James in a note published on Monday. This “could be a debate point for some investors,” they added.
As part of the agreement, the SRS from Home Depot will buy all outstanding shares of the GMS stem shares for $ 110 per share, which brings the value to 4.3 billion US dollars. The transaction is expected to be completed at the end of this financial year.
Home Depot refused AssetsRequest for comments about whether the company overpaid the GMS acquisition.
Nevertheless, Raymond James analysts said this acquisition as “the clear number 1 in the drywall distribution” in front of the FBM in private equity as “clear no. 1”. The acquisition “also escalates pressure on other corporate improvement companies such as Lowe and QXO (formerly Beacham Building Products), according to Raymond James analysts that added the acquisition, helps the Home Depot for drywall, ceiling and steel framing.
According to the acquisition, Home Depot offers more fulfillment and service options than ever by creating a network of more than 1,200 locations and a fleet of more than 8,000 trucks. This enables tens of thousands of construction sites a day, said Dan Tinker, CEO of SRS in an explanation.
“The Home Depot has acquired SRS as a platform for growth, and SRS continues to show extraordinary execution and strong performance,” said Ted Decker, Chairman, President and CEO of Home Depot. “This success gives us the trust that the addition of GMS to the SRS platform enables us to create an even higher value for our customers.”
In their conclusion, Raymond James analysts wrote that the Home Depot, if the Home Depot is higher than the basic case yield-per-share (EPS) and the profit before interest and taxes (EBIT), is detailed, “expect” expecting the modest paid premium and the acquisition are viewed positively “.
