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NEW YORK CITY–Published reports that an investment group is looking to acquire Home Depot in a $100 billion leveraged buyout are likely nothing more than speculation, but even if the takeover were to take place, don’t expect a massive closing of stores, observers say.

On Dec. 1, the New York Post and CNBC reported that buyout firms Kohlberg Kravis Roberts and Co. and Texas Pacific Group were exploring a takeover. Home Depot chairman Robert Nardelli was quick to deny any interest in being acquired, and informed the SEC on Friday that it had not participated in any talks. But even if a deal were to take place, the new owners would likely continue to operate the second largest retailer in the United States largely as is – but with massively more debt.

“Home Depot has a lot of real estate that [new owners] might sell off, or they might do sale/leasebacks,” said Howard Davidowitz, chairman of New York City-based Davidowitz & Associates, which provides consulting and investment bank services to retailers. “But fundamentally, that might not affect the core business.”

The stock price has been lagging for years under Nardelli’s leadership, possibly making it a target. In the past, LBOs have operated by breaking up a company’s individual assets after the acquisition to pay down the debt incurred by the acquisition. But as an operator of extremely large stores, Home Depot’s units likely would have few takers – chiefly Wal-Mart, Target or home improvement rival Lowe’s.

“I don’t think there will be an enormous sellout,” Davidowitz said. “The idea would be to operate it as a laggard and make it better.”

There’s lots of potential in terms of improving operations, said Joseph Feldman, a managing director and senior hardlines analyst for Telsey Advisory Group, a New York City-based investment advisory firm. The company still has to invest heavily in systems to increase efficiencies.

Still, most consider any deal unlikely. Though Home Depot’s shares have not risen in price, “they pay big dividends and have rewarded their shareholders in other ways,” Feldman said.

In addition, the new owners have to consider their eventual exit strategy, he warns.

“What do you do in five years? Go public?,” Feldman said. “At the end of the day, on paper, it could happen. But it doesn’t look like anyone at Home Depot wants it to happen.”

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