Hughes Supply will operate as part of The Home Depot Supply, a division that serves business-to-business customers such as homebuilders, professional contractors, municipalities and maintenance professionals.

This move will more than double the size of The Home Depot Supply, with projected 2006 combined sales approaching $12 billion. Together, the two companies will serve a $410 billion market, addressing the continuum from infrastructure and construction to maintenance, repair and remodel.

Hughes Supply, which has more than 500 locations in 40 states and employs about 9,600 associates, has been ranked No. 2 in PM sister publication Supply House Times' Premier 150 listing of wholesalers, since 2002, just behind Newport News, Va.-based Ferguson. Prior to that, Hughes had been ranked No. 1 in the Premier 150 since 1998.

Hughes Supply has ranked in the top five among Premier 150 wholesalers since Supply House Times published its first listing in 1993.

The Home Depot said that Hughes Supply's leading position in many of the professional markets will add new platforms to The Home Depot Supply portfolio, while also providing additional scale to the division's positions in water works, professional construction supply and multifamily maintenance. The combination will deliver purchasing synergies; enhance overall operating effectiveness through scale, simplification and knowledge transfer; and accelerate growth by providing professional customers exceptional value, convenience and choice, the home improvement retailer said.

“Hughes Supply, our largest acquisition thus far, will accelerate the execution of The Home Depot Supply strategy of repeating in the professional space the same type of market transformation The Home Depot pioneered and executed in the do-it-yourself retail space,” Joe DeAngelo, executive vice president of The Home Depot Supply, said in a statement. “We are looking forward to working closely with Tom Morgan, president and CEO of Hughes Supply, and the company's leadership team to establish an integrated professional business of motivated associates that focus on service, growth and shareholder value.”

According to documents filed with the Securities and Exchange Commission, Morgan will stay with Hughes until the transaction closes, late in the first quarter or early in the second quarter of this year. At that time, DeAngelo will head the combined organization.

The documents also stated that Hughes would remain in Orlando. Whether the Hughes name will be retained has not been determined.

Hughes Supply reported the highest quarterly net sales in its history in the third quarter ended Oct. 31. Sales for its last fiscal year ended Jan. 31, 2005, were $4.4 billion. The wholesaler addresses multiple segments of the construction, maintenance and repair industry including plumbing/HVAC, industrial PVF, water and sewer, MRO, electrical, building materials, and an “other” segment that includes the mechanical and fire protection businesses.

Construction Loan Program: In other news, The Home Depot announced the launch of The Home Depot SPEC Construction Loan program, available through all of its 1,767 U.S. stores. The first nationwide SPEC loan program for qualified contractors, builders and developers, it gives borrowers up to $2 million and the ability to earn 5 percent rebates on all project supplies and materials bought at The Home Depot, The Home Depot Supply, The Home Depot Floor Store, The Home Depot Landscape Supply, and EXPO Design Center.

The program targets small- to medium-sized residential contractors, builders and developers with at least five years of experience in the building and marketing of single-family homes. Those not meeting these criteria will be reviewed on an individual basis. The loans will be provided by IndyMac Bank.

For more information, go to www.hdconstructionloan.com or call 800/281-0855.

Links

• The Home Depot SPEC Construction Loan program