by William White | June 17, 2013 1:13 pm
Lowe’s (LOW) just made another move in hopes of overcoming rival and the nation’s top home improvement retailer.
LOW offered to buy about 60 Orchard Supply Hardware (OSH) stores in California on Monday for $205 million. The offer came after Orchard filed for Chapter 11 bankruptcy protection.
Orchard’s stores are actually smaller than Lowe’s current retail locations; the company hopes this will provide a new way to reach current customers and bring in new customers as well.
“This transaction is about the convenience deficit that Lowe’s currently has relative to Home Depot in key metro markets around the U.S.,” Janney Capital Markets analyst David Strasser told the Associated Press. “This acquisition would help immediately in California, and possibly set up a strategy for other key metro markets.”
Orchard Supply Hardware stores won’t be rebranded as Lowe’s.
Lowe’s Chairman and CEO Robert A. Niblock said in a statement to the Associated Press that “Orchard’s business has potential but also has been burdened with high debt.”
LOW shares had improved 1% as of midday Monday.
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