HD And HD Supply Agree On Post-Closing Price
Home Depot and its former division HD Supply came to an agreement of a post-closing purchase price adjustment that will see Home Depot pay $22 million to HD Supply.
The Atlanta-based retailer sold HD Supply in August 2007 for $8.5 billion to three of the world's leading private equity firms: Bain Capital; The Carlyle Group; and Clayton, Dubilier and Rice (CD&R), with Home Depot retaining a 12.5 percent equity stake in the company.
"We are very pleased to have reached an agreement and to put this matter behind us," said Joe DeAngelo, HD Supply's CEO. "The Home Depot is a valued customer and minority investor of HD Supply, and we look forward to continuing our good relationship and to serve them."
The post-closing adjustment also includes other non-cash considerations, according to the announcement.
With some 900 locations, HD Supply is a diversified, wholesale distributor in the infrastructure and energy, maintenance, repair and improvement and specialty construction markets.
In connection with its minority stake in HD Supply, Home Depot recently announced that it would record a pre-tax charge of $163 million for a write-down of its investment in HD Supply. The write-down reflects a lower valuation for its investment and is consistent with the decrease in the overall market since 2007. According to HD Supply, this accounting adjustment does not impact HD Supply's operations, funding or access to capital.