Home Depot Buys SRS Distribution for $18B
Building products supply network for pro contractors has 760 branches in 47 states.
The Home Depot has backed up its strategy of better serving the needs of its professional customers with the largest acquisition in its history: the home improvement giant is buying McKinney, TX-based SRS Distribution for $18.25B.
The deal, which Home Depot said would be financed through “cash on hand and debt,” adds a building supply products distribution network with more than 760 branches in 47 states to the industry leader.
SRS, which serves the professional roofer, landscaper and pool contractor sectors, has a fleet of 4,000 delivery trucks offering jobsite delivery capabilities and a salesforce of more than 2,500.
Atlanta-based Home Depot believes that the acquisition of SRS, combined with Home Depot’s 2,000+ stores and distribution centers, doubles the size of the retail giant’s “total addressable market,” to $1T from $50B, CEO Ted Decker said in a release.
“SRS has built a robust and successful platform that will accelerate our growth with the residential professional customer while presenting future opportunities with the specialty trade pro,” Decker said.
“We are looking forward to combining our differentiated assets and capabilities, including our extensive branch network, experienced sales team, robust trade credit offering, and order management system, geared at serving the complex project purchase occasion, with The Home Depot’s competitive advantages,” SRS CEO Dan Tinker said, in a statement. “We believe this will enable us to better serve pros and continue growing in our large and highly fragmented market.”
Early last month, Home Depot signaled it was betting big on its professional contractor segment-also known as “pro” customers-when the retailer announced it would open four new distribution centers geared to serving pro customers in Detroit, southern Los Angeles, San Antonio and Toronto in the first half of 2024.
The new distribution centers will stock lumber, insulation and roofing shingles, enabling industry professionals to order job lot quantities needed to complete entire projects, with the building materials delivered directly to job sites.
Home Depot expects to close the SRS acquisition, which is subject to regulatory approval, by the end of fiscal 2024.