- Home Depots SRS Distribution agreed to buy GMS for $110 per share in cash, valuing it at about $4.3B equity and $5.5B enterprise value including net debt.
- SRS won a competitive process, topping QXOs roughly $5B hostile bid and paying about a 36% premium to GMSs pre-talk trading price.
- The deal closed in early September 2025 after ~79.5% of shares were tendered, making GMS an indirect wholly owned subsidiary of Home Depot via SRS.
- Home Depot expects the acquisition to broaden its Pro ecosystem into drywall and steel framing, expand reach to 1,200+ locations with an 8,000-truck fleet, and be adjusted-EPS accretive within a year while targeting ~2.0x leverage by fiscal 2026.
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On June 30, 2025, The Home Depot entered into a definitive agreement through its specialty trade distribution unit, SRS Distribution, to acquire GMS Inc., a distributor of drywall, ceilings, steel framing, and other specialty building products. The transaction amounts to an equity value of approximately $4.3 billion ($110 per share in cash), and an enterprise value (including net debt) of about $5.5 billion. This purchase price represented a ~36% premium over GMS’s share price on June 18, 2025, before other bids emerged, and approximately 13% above its most recent closing price prior to the deal. SRS (and by extension Home Depot) successfully outbid QXO — an alternative bidder offering ~$95.20 per share — reinforcing the strategic importance Home Depot attributes to gaining greater scale in the Pro-builder segment.
The merger closed on September 3-4, 2025: 79.5% of GMS shares were tendered, satisfying the majority vote requirement, after which GMS was merged into a Home Depot sub-entity, making it an indirect wholly-owned subsidiary of The Home Depot via SRS. The transaction is funded through a combination of cash and debt; Home Depot remains committed to its plan to return to a leverage ratio of ~2.0× by the end of fiscal 2026 despite this added debt liability.
From a strategic standpoint, this acquisition reinforces Home Depot’s push further into the Pro-customer market—a cohort of professional contractors whose purchase needs are material, recurring, and less sensitive to home‐owner sentiment and mortgage rate pressures. Through GMS, SRS adds adjacent product verticals (wallboard, steel framing, ceilings) that complement its existing portfolio in roofing, landscaping, and pools acquired as part of SRS in 2024. The combined network will cover over 1,200 Pro locations and deploy more than 8,000 trucks, enhancing jobsite delivery density and service flexibility.
Financially, the deal is expected to be accretive to Home Depot’s adjusted earnings per share in the first full year after close (excluding synergies). However, risks remain: integration complexity, margin pressure from new categories or lower turnover, possible regulatory challenges, exposure to supply chain inflation, and execution of the debt reduction plan to restore leverage to target by end of FQ 2026. Additionally, investor reefed interest from analysts: Mizuho retained an Outperform with $435 target; Truist emphasized that at ~$5.5 billion EV and ~11× depressed EBITDA, the deal is “easily digestible” but cautious around margin dilution.
Supporting Notes
- The acquisition price is $110 per share in cash, equity value ~$4.3 billion, enterprise value ~$5.5 billion including net debt..
- Home Depot’s SRS will commence a tender offer for all outstanding common stock of GMS, subject to regulatory approvals; expected close by end of fiscal 2025..
- GMS network includes over 300 distribution centers and nearly 100 tool rental/servicing centers across the U.S. and Canada..
- Post‐acquisition, SRS+GMS network will expand to over 1,200 locations and 8,000 trucks, enabling tens of thousands of jobsite deliveries per day..
- The tender offer closed with ~79.5% of shares tendered by September 3, 2025; then GMS merged and all remaining shares converted for $110/share..
- Home Depot acquired SRS in 2024 for $18.25 billion, including debt, which launched its specialty trade platform..
- The deal is expected to be accretive to adjusted EPS in the first year following closing, excluding synergies..
- Management: Ted Decker (Home Depot CEO) and Dan Tinker (CEO of SRS) stress cross‐selling, service expansion, and operational synergies; GMS’ leadership (John C. Turner Jr. and senior team) will remain and operate under SRS..