Home Depot (HD) said it agreed to buy home repair and maintenance products seller Interline Brands Inc for about $1.63 billion in cash to expand its Pro division, which caters to professional contractors and builders.
Interline offers facilities maintenance as well as repair services and products to home and commercial customers through brands such as SupplyWorks, HardwareExpress and Barnett.
The Wall Street Journal called the deal Home Depot’s biggest in nearly a decade and a bid to capitalize on rising rates of renters amid declining homeownership.
Interline is owned by Goldman Sachs Capital Partners, P2 Capital Partners LLC and management.
Home Depot’s Pro customers are mostly professional remodelers, contractors and repairmen looking for services such as delivery, expanded credit and bulk pricing. The Pro portfolio of brands include DeWalt and Makita.
Home Depot said Bill Lennie, president of its Canada operations, will oversee the integration and then lead the Pro, MRO and installation services business in a newly created role.
Lennie will also continue to head the Canadian operations until his successor is appointed, the company said.
Home Depot said it expects the deal to add to its earnings in the current financial year. The deal is expected to close in the quarter ending Nov. 1.
Home Depot’s financial adviser is Bank of America Merrill Lynch, while Cleary Gottlieb Steen & Hamilton LLP gave legal advice.