BREAKING NEWS!...The Home Depot To Acquire Hughes Supply
Hughes Supply will operate as part of The Home Depot Supply, a division that serves business-to-business customers such as homebuilders, professional contractors, municipalities and maintenance professionals. This move will more than double the size of The Home Depot Supply, with projected 2006 combined sales approaching $12 billion. Together, the two companies will serve a $410 billion market, addressing the continuum from infrastructure and construction to maintenance, repair and remodel. Hughes Supply, which has more than 500 locations in 40 states and employs about 9,600 associates, has been No. 2 in SUPPLY HOUSE TIMES' Premier 150 listing of wholesalers, which ranks companies by their annual sales, since 2002, just behind Newport News, VA-based Ferguson. Prior to that, Hughes had been ranked No. 1 in the Premier 150 since 1998. Hughes Supply has ranked in the top five among Premier 150 wholesalers since SUPPLY HOUSE TIMES published its first listing in 1993.
The Home Depot said that Hughes Supply's leading position in many of the professional markets will add new platforms to The Home Depot Supply portfolio, while also providing additional scale to the division's positions in water works, professional construction supply and multi-family maintenance. The combination will deliver purchasing synergies; enhance overall operating effectiveness through scale, simplification and knowledge transfer; and accelerate growth by providing professional customers exceptional value, convenience and choice, the home improvement retailer said.
“Hughes Supply, our largest acquisition thus far, will accelerate the execution of The Home Depot Supply strategy of repeating in the professional space the same type of market transformation The Home Depot pioneered and executed in the do-it-yourself retail space,” Joe DeAngelo, executive vice president of The Home Depot Supply, said in a statement. “Together, we can better serve local, national and government customers, offer the broadest range of products and services, and drive synergies by leveraging our combined purchasing power and customer service. We are looking forward to working closely with Tom Morgan, president and CEO of Hughes Supply, and the company's leadership team to establish an integrated professional business of motivated associates that focus on service, growth and shareholder value.”
Hughes' Tom Morgan said in a statement, “Home Depot Supply is well-positioned in the marketplace and possesses a wealth of resources to thrive in an industry where there are tremendous opportunities for growth. This combination is positive for all of our constituents: creating significant shareholder value, increasing the opportunities available to our employees, continuing our commitment to superior service to customers and building on the foundation of strong vendor relationships.
“We have accomplished a great deal since our company's founding in 1928 due to the dedication and hard work of our people. Together with Home Depot Supply, we are positioned to achieve even more. We have a bright future ahead.”
Hughes Supply reported the highest quarterly net sales in its history in the third quarter ended Oct. 31. Sales for its last fiscal year ended Jan. 31, 2005, were $4.4 billion. The wholesaler addresses multiple segments of the construction, maintenance and repair industry including plumbing/HVAC, industrial PVF, water and sewer, MRO, electrical, building materials, and an “other” segment that includes the mechanical and fire protection businesses. Speculation regarding this acquisition was published in SUPPLY HOUSE TIMES (December 2005, page 6) based on stories in the Wall Street Journal and the Orlando Sentinel.
- Pat Lenius