The American company Lowe’s, owner of the RONA and Réno-Dépôt stores, announced Thursday that it will divest of its Canadian branch. Sycamore Partners, a New York-based private equity firm specializing in the retail, consumer and distribution sectors, intends to acquire it for US$400 million. and deferred consideration calculated on future performance”.
Around 450 home improvement stores would be affected by the transaction. The general manager of Sycamore Partners has also indicated that he wanted to make “Lowe’s Canada and Rona an independent company” by maintaining the head office where it is located, in Boucherville, Quebec.
RONA, founded in Quebec in 1939, bought Réno-Dépôt in 2003. The company was sold to Lowe’s in 2016 for 3.2 billion Canadian dollars.
Lowe’s Chairman and CEO Marvin R. Ellison justified this new transaction by a desire to simplify its business model. “While this business represents approximately 7% of our full-year 2022 revenue outlook, it also represents approximately a 60 basis point dilution of our operating margin outlook for the whole of 2022,” he said in a statement.
In a statement released Thursday, Lowe’s Canada said the transaction is expected to close in early 2023, subject to, among other things, “receiving regulatory approvals.”
Among the companies acquired in the past by Sycamore Partners in 2017 was the office supply chain Staples, known as Bureau en gros in Quebec.
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