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Lowe’s today announced an agreement to buy Canadian home improvement retailer and distributor RONA Inc. in a $2.3 billion deal, dramatically enlarging the U.S. company’s presence in Canada.
“The transaction is expected to accelerate Lowe’s growth strategy by significantly expanding our presence in the Canadian market through the addition of RONA’s attractive business and excellent store locations across the country,” says Robert Niblock, Lowe’s chairman, president and CEO.
“Importantly, the transaction also provides Lowe’s with entry into Quebec, where RONA is the market leader and we have no presence.”
The boards of directors for both companies have agreed unanimously on the deal, according to Lowe’s.
Lowe’s Canada president Sylvain Prud’homme will oversee both the existing Lowe’s operations in the country and the RONA acquisition.
RONA operates about 500 corporate and independent affiliate stores in multiple formats. RONA also has nine distribution centers and employs more than 17,000 workers in its corporate stores. About 5,000 employees work for independent affiliate stores.
Lowe’s has committed to the following:
- The company’s Canadian businesses will be headquartered in Boucherville, Quebec, and maintain RONA’s business operations there.
- RONA’s multiple retail store brands will remain.
- Lowe’s will enhance distribution services to independent retailers.
- RONA will retain the majority of its current employees and key executives from its leadership team.
- RONA’s local and ethical procurement work will continue.
- The companies will potentially grow their relationships with Canadian manufacturers and suppliers.
“With our share of customer-centric values and a steadfast commitment to the Canadian market, we expect to generate significant long-term benefits for shareholders, customers, vendors, employees and the communities we serve,” Niblock says.
Lowe’s Canada has roughly 40 Lowe’s locations in the country. RONA operates a network of close to 500 locations, which Lowe’s will operate moving forward.
