Home Depot’s largest acquisition ever is an $18.25 billion bet on the housing market’s severe shortage of new homes – Fortune

Deal OverviewHome Depot is acquiring SRS Distribution, a materials provider for professionals, in a deal valued at approximately $18.25 billion.
Largest AcquisitionThis deal marks Home Depot’s largest acquisition in its history, signaling a more aggressive entry into the professional builder and contractor market.
Target MarketSRS provides materials for professionals such as roofers, landscapers, and pool contractors.
Housing Market BetHome Depot is making a significant bet on the housing market, which is facing a severe lack of new homes, leading to skyrocketing prices.
Median Home PricesOver the past five years, the median sales price for new homes in the U.S. has climbed by 29.4%, reaching $417,700 in the fourth quarter.
Recent Market TrendsThe U.S. housing market experienced a two-year sales slump due to a shortage of homes and rising mortgage rates.
Market RecoverySales of previously occupied U.S. homes rose in February, driven by a modest pullback in mortgage rates, encouraging homebuyers.
Home Maintenance DemandWith high mortgage rates, millions of homeowners are investing in home upkeep, contributing to the financial drivers for the Home Depot-SRS deal.
Total Addressable MarketHome Depot estimates its total addressable market to be approximately $1 trillion, with the deal expanding it by approximately $50 billion.
Company IntegrationHome Depot plans to leverage SRS’s sales team of over 2,500, 760+ branches across 47 states, a 4,000+ truck fleet, and jobsite delivery capabilities.
Leadership ContinuitySRS CEO Dan Tinker and his senior management team will continue to lead SRS, which is based in McKinney, Texas.
Expected Closing DateThe deal is expected to close by the end of fiscal 2024.
This table provides a structured overview of the key aspects and details of the Home Depot-SRS Distribution acquisition
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