Latest News

June 15, 2007 - Two Deals For HD Supply? reports today that two private-equity groups will each offer separate competing bids of about $10 billion for HD Supply.

The first group is comprised of Bain Capital LLC, Carlyle Group and Clayton Dubilier & Rice Inc. That last company recently agreed to buy ServiceMaster Co. The other includes Thomas H. Lee Partners LP and CCMP Capital Advisors LLC.

At least a few of the players aren’t strangers to investing in the professional contractor supply market. Clayton Dubilier & Rice had previously bid on Hughes Supply, but lost out to Home Depot. Lee Partners and CCMP sold National Waterworks to Home Depot, which is now a part of HD Supply.

No one from any of the investment companies or from Home Depot would confirm the possible move. However, final bids are due to Home Depot today.

Home Depot announced last February it might sell its wholesale division. HD Supply was largely the work of Robert Nardelli, the company’s former chief executive officer. Nardelli aggressively bought wholesale distributors, including Hughes Supply last year.

HD Supply had sales of $12.1 billion last year. Home Depot may have spent as much as $8 billion to acquire the 38 companies that make up the unit, David Schick, an analyst with Stifel Nicolaus & Co., wrote in a February research note.

At one time, Nardelli predicted HD Supply would generate 20 percent of Home Depot’s overall revenue. HD Supply wasn’t far off that mark. It currently accounts for 13 percent of Home Depot’s revenue.

But Wall Street criticized the wholesaler acquisitions and believed the money and management energy would be better put to use reinvigorating the retail side. The stock, down 5.9 percent this year through yesterday, was the worst performer in the Dow Jones Industrial Average before today.

Home Depot ousted Nardelli in January after the former General Electric Co. executive's pay package, abrasive style and aggressive acquisition strategy alienated investors.

Ralph Whitworth, an activist shareholder, called Nardelli’s HD Supply expansion “strategic adventurism” and urged Home Depot to sell or spin off the division.

Since then, Frank Blake, the new CEO, has made various moves to restore the retail business. His February announcement on HD Supply sent the company’s stock price to a 10-month high.

Did you enjoy this article? Click here to subscribe to Supply House Times. Stay connected with us via social media.

You must login or register in order to post a comment.



Image Galleries

A pictorial look at Supply House Times' travels in the early part of 2015

Industry events are in full swing. Here’s a pictorial look at Supply House Times’ travels in the early part of 2015.

8/26/14 1:00 pm EST

Free Webinar: Low Temperature Heat Emitter Options in Hydronic Systems

With proper design, you can create systems that require supply water temperatures no higher than 120° F under design load conditions.

Supply House Times

march cover

2015 March

SHT's February issue features cover story: Woman-owned American Precision Supply is an industrial PVF success story and the features: Women in Industry: 2015; Manufacturers enthused after record-breaking 2015 AHR Expo; Planning ahead at the ASA Winter Leadership Conference; and Green products abundant at Design & Construction Week 2015.
Table Of Contents Subscribe

Where do you look for new employees?

Where do you look for new employees?
View Results Poll Archive

The Supply House Times Store

2015 National Plumbing & HVAC Estimator

Every plumbing and HVAC estimator can use the cost estimates in this practical manual!

More Products

Clear Seas Research

CS-OflRGBhomepage.jpgWith access to over one million professionals and more than 60 industry-specific publications,Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.


facebook Twitter Updated icon Youtube Updated icon    LinkedIn Updated icon  Google+

Premier 125

Premier 125 button

The information SUPPLY HOUSE TIMES uses to rank the Premier 125 is the most accurate we can gather. It is primarily based on responses to a questionnaire we send to the wholesalers in our database, supplemented with information obtained from industry reports and estimates.