Lowe’s makes another run for Canada’s Rona in $2.3B deal

Lowe, which withdrew a C$1.8 billion unsolicited proposal to buy Rona in September 2012, said on Wednesday it had agreed to key commitments including moving the headquarters of its Canadian business to Rona’s home base of Boucherville, Quebec.

Lowe’s is expected to pay cash and acquire all issued and outstanding common shares of RONA for $24 in Canadian dollars per share.

Lowe’s will pay about C$24(US$17.15) for each outstanding common share and C$20 for each outstanding preferred share of RONA.

The directors and management of both companies support the deal, although it would require various approvals.

It’s Lowe’s second run for the company.

Lowe’s expanded Canadian operation, which would have had revenue of C$5.6 billion in 2015, will be led by Sylvain Prud’homme, current president of Lowe’s Canada.

The companies say the combination will make Lowe’s the Canadian market leader.

“The team at Lowe’s has presented us with an excellent plan that enables our company to maintain its brand power while at the same time leveraging Lowe’s global presence to build upon and expand our reach”.

Lowe’s has close to 1,900 home improvement and hardware stores in the United States, Canada and Mexico.

Rona has almost 500 corporate and independent affiliate dealer stores in Canada and nine distribution centers.