Rona turns down $1.9 billion acquisition bid by Lowe’s
Lowe’s made an offer, but Rona refused.
The two North American home improvement giants will continue to operate as competitors in Canada, where Lowe’s has been growing organically for the past several years amid rumors that just such an acquisition play was in the cards.
In the end, the Canadian retailer and distributor Rona rebuffed a $14.21 per share -- $1.85 billion -- acquisition offer. "Rona's strategic focus remains to execute on its business plan with a view to capturing the significant opportunities that it sees for the business," Rona said in a statement.
According to Lowe’s, the non-binding proposal was delivered to Rona board chairman Robert Paré, on July 8. Rona's board asked Lowe's for additional time to consider the proposal but, then rejected it.
On Tuesday, Lowe’s made it’s proposal public, and it can be seen here.
Lowe’s, which operates 31 stores in Canada, says it hopes the Rona board will reconsider the offer.
In its pitch, Lowe’s said that “Combining Rona's Canadian operations with Lowe's strong global presence would provide Rona's operations with substantial benefits by creating a strengthened Canadian home improvement retailer with world-class capabilities across channels and geographies. While the combined Canadian business would undoubtedly benefit from Lowe's global reach and deep supplier relationships, Lowe's believes that preserving Rona's local market expertise and relationships is critical.”