Lowe's Companies, Inc., the world's second largest home improvement retailer, plans to acquire 72 Orchard Supply Hardware stores. Lowe's will pay about $205 million in cash and will assume payables owed to nearly all of Orchard's supplier partners.
Orchard told Lowe's that no other bids came in by the deadline of August 9, 2013. The transaction will be presented to the Bankruptcy Court for approval on Aug. 20, 2013, and Lowe's expects to complete the acquisition by the end of August.
Lowe's intends for Orchard to operate as a separate, standalone business, retaining its brand, and operating under Orchard's current management team.
Lowe's expects the acquisition to help it expand its presence in California and reach a new customer base with Orchard's smaller-format stores in densely populated areas. Orchard's neighborhood hardware and garden stores offer a product selection focused on paint, repair, and backyard categories in approximately 36,000 square feet of selling space, compared to 113,000 square feet for an average Lowe's home improvement store.
Lowe's currently has 110 stores in California.
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