Lowe's Moves to Acquire Orchard Supply Hardware Stores
MOORESVILLE, N.C.-Lowe's is progressing in its plan to acquire the majority of assets of Orchard Supply Hardware, including 72 stores, for $205 million in cash.
The transaction is subject to the approval of U.S. Bankruptcy Court in the district of Delaware, in which Orchard filed for Chapter 11 protection in June, and will be presented to the court for approval on Aug. 20. Lowe's said it anticipates closing the acquisition by the end of this month.
Once completed, the purchase will enable Lowe's to extend its presence in California, where Orchard is based. It will also permit Lowe's to reach a new customer base through the addition of Orchard's smaller-format stores in densely populated areas, according to Lowe's. The average Orchard store measures 36,000 square feet of selling space, compared to the average Lowe's location, with 113,000 square feet of selling space.
Currently, Lowe's has 110 stores in California. The company said it plans to have Orchard operate as a separate, stand-alone business, retaining its brand under the leadership of its current management team.