Lowe’s Cos. agreed this week to buy rival Rona Inc. for C$3.2 billion ($2.3 billion) in cash to create one of Canada’s biggest home-improvement retailers, almost four years after its earlier takeover proposal got rebuffed.
Lowe’s, which serves business customers through its e-commerce site LowesForPros.com, said businesses accounted for about 30% of the company’s total sales of $14.4 billion, in its most recent third quarter earnings filing. Lowe’s already has a Canadian division with about 40 stores and more than C$1 billion ($731.62 million) in revenue. Adding Rona’s roughly 500 locations will create a Canadian operation with C$5.6 billion ($4.1 billion) in sales. Rona does not break out what portion of its sales are to business customers.
But business customers can log in to Rona.ca/EN/Contractors for an expanded product selection of “contractor grade products” and discounted pricing. The company also offers contractors an online billing service, Billing.Rona.ca, which lets companies access their statements online and pay through e-invoices.
The deal will allow Lowe’s to capture a greater share of Canada’s growing home-improvement industry, valued at more than C$45 billion, CEO Robert A. Niblock said in a statement on Feb. 3. Lowe’s has identified more than C$1 billion of opportunities to further increase revenue in Canada, where it says it could double operating profitability in five years, according to the statement.
Although Lowe’s doesn’t break out its online sales, the B2B E-Commerce 300 estimates its 2015 B2B e-commerce sales at $350 million, and the Internet Retailer Top 500 estimated its 2014 retail e-commerce sales at $1.265 billion.
For more about Lowe’s and its plans, click here.
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