Lowe's Expands Into Smaller-Format Store Market With Completion of Orchard Acquisition
Lowe's Companies on Friday confirmed that it has completed its previously announced acquisition of the majority of assets from Orchard Supply Hardware, in particular its acquisition of 72 Orchard stores, for approximately $205 million in cash plus assumption of Orchard's accounts payable to its suppliers.
Lowe's said it intends to operate Orchard as a stand-alone business, retaining both its brand name and its San Jose, Calif., headquarters. In a statement, Lowe's explained that "Orchard's smaller-format neighborhood stores ... are a natural complement to Lowe's strengths in big-box retail" in California. Located in high-density, prime locations that are difficult for 100,000-plus-square-foot home improvement stores like Lowe's to enter, Orchard's 36,000-square-foot neighborhood stores focus on selling paint, repair supplies, and backyard equipment.
"Orchard is well-positioned within the California marketplace, with a strong brand, loyal customers and significant opportunity to benefit from the economic recovery," said Lowe's business development executive and president of Orchard, Richard D. Maltsbarger.
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