Home Depot purchases construction equipment rental provider Compact Power

The Home Depot Inc. (NYSE: HD) is buying Compact Power Equipment Inc., a U.S. provider of equipment rental and maintenance services, for $265 million in cash. Compact Power has been a long-term commercial partner of The Home Depot since 2009.

Based in Fort Mill, South Carolina, Compact Power offers a variety of construction equipment, including: skid steers, cranes, excavators, tractor loaders, trenchers and other aerial equipment. The target has more than a 1,000 stores across the U.S. and Canada. Compact Power also provides equipment maintenance services for clients such as Home Depot.

“The acquisition allows us to further improve the customer experience – in particular for Pros – through enhanced equipment and tool rental offerings,” states Home Depot CEO Craig Menear. “It also allows us to grow Compact Power's best-in-class building services capabilities."

Home Depot is one of the largest retailers of home improvement equipment for the professional services and the everyday do-it-yourself customer community. The buyer has approximately 2,281 retail stores across the U.S. Canada and Mexico. Home Depot reported $94.6 billion in sales revenue in fiscal year 2016. In 2015, Home Depot acquired Interline Brands Inc. to attract more professional contractors.

Construction-related M&A is setting out to be an important industry for buyers in the middle-market throughout 2017. Other deals involving construction-related materials and equipment makers include: Lowe’s (NYSE: LOW) purchase of Maintenance Supply Headquarters, a producer of repair and home improvement tools for the multifamily housing sector; KPS Capital Partners’ acquisition of steel abrasive manufacturer WHA Holding SAS; ABC Supply Co.’s purchase of L&W Supply, a distributor of drywall, ceiling tiles and steel framing materials to building contractors, from USG Corp. (NYSE: USG); Southwire Co. LLC’s buying United Copper Industries Inc., a maker of electrical wire, from KPS Capital Partners.

The Home Depot
Home Depot Inc. signage is displayed on the exterior of the company's store in Torrance, California, U.S., on Friday, May 13, 2016. Home Depot is scheduled to release earnings figured on May 17. Photographer: Patrick T. Fallon/Bloomberg

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