Home Depot Completes Acquisition of GMS for $5.5 Billion

The Home Depot has completed the acquisition of GMS Inc. for a total enterprise value of approximately $5.5 billion. GMS is a leading distributor of specialty building products, including drywall, ceilings, and steel framing. The acquisition enhances SRS Distribution Inc.'s position as a leading multi-category building materials distributor and expands The Home Depot's capabilities to serve professionals across their entire project.

The Home Depot (NYSE: HD) has finalized its acquisition of GMS Inc. for an enterprise value of approximately $5.5 billion. GMS, a leading distributor of specialty building products such as drywall, ceilings, and steel framing, will now be a subsidiary of SRS Distribution Inc., a division of The Home Depot. This strategic move aims to enhance SRS's position in the building materials distribution sector and expand The Home Depot's capabilities to serve professional contractors more comprehensively.

The acquisition was executed through a tender offer at $110 per share, with approximately 79.5% of outstanding shares tendered. The remaining shares were subsequently converted through a merger, making GMS a direct subsidiary of SRS and an indirect wholly-owned subsidiary of The Home Depot [1].

GMS's unique operating model, which combines a national platform with a local go-to-market focus, will complement SRS's existing capabilities. This integration is expected to create significant cross-selling synergies and expand the product categories available to professional contractors, both for residential and commercial projects [2].

The acquisition follows The Home Depot's 2024 acquisition of SRS Distribution, indicating an accelerating strategy to capture more professional contractor business through specialized distribution channels. This multi-channel approach shows The Home Depot is pursuing market share growth by meeting professional contractors where they prefer to purchase materials.

The anticipated cross-selling synergies between SRS and GMS should create meaningful revenue opportunities. The combined entity can now serve professionals across more product categories and project types, potentially providing a competitive advantage against both traditional retailers and specialized distributors by offering contractors a single-source solution for diverse material needs.

References:
[1] https://www.stocktitan.net/news/HD/the-home-depot-and-its-subsidiary-srs-distribution-complete-mzvenu19lo8k.html
[2] https://www.marketscreener.com/news/the-home-depot-and-its-subsidiary-srs-distribution-complete-acquisition-of-gms-ce7d59d8db8bff24