The largest acquisition in Home Depot's history, the deal worth $18.25 billion was revealed today. It included the acquisition of SRS Distribution. By making this move, Home Depot hopes to increase its market share among professional contractors by taking advantage of SRS Distribution's wide network and proficiency in providing landscaping, swimming pool, and roofing companies. This acquisition fits perfectly with Home Depot's plan to increase its market share as people reduce their do-it-yourself projects, especially in the lucrative construction sector.
The purchase of SRS Distribution enhances Home Depot's present efforts to serve its professional clientele, who currently account for half of its total revenue. Home Depot is looking to capitalize on a $50 billion market opportunity by increasing its professional-focused product choices and delivery capabilities. In order to improve the company's competitive position and meet the changing needs of professional contractors in a variety of industries, CEO Ted Decker sees the purchase as a strategic accelerator.
Home Depot expects the acquisition to be accretive in terms of cash profits per share within the first year of concluding the deal, notwithstanding the anticipated dilution to earnings per share due to amortization. Home Depot's dedication to fostering growth in the face of slowing sales trends during the pandemic is evident in this acquisition. The company's objective is to maintain its competitive advantage in the retail industry by persisting in its focus on growing its store presence, drawing in more professional sales, and improving the customer shopping experience. As of the close of trading last week, Home Depot's shares have seen an approximately 11% increase year-to-date, slightly surpassing the 10% gains of the S&P 500.
