Retail

Home Depot buys GMS for $4.3 billion to target more home pros

Ken Metral

30 Jun 2025 — 2 min read

Image Credit: The Home Depot, Inc./Blairsville, Georgia/Harrison Keely

Home Depot has announced a definitive agreement to acquire GMS Inc., a major building products distributor, for approximately $4.3 billion in cash, intensifying its push to serve professional contractors and tradespeople. The acquisition, expected to close by early 2026, will be executed through Home Depot’s SRS Distribution subsidiary, which it acquired just last year for $18.25 billion.

Under the terms of the deal, SRS will purchase all outstanding shares of GMS at $110 per share. Including net debt, the total enterprise value of the transaction reaches about $5.5 billion.

Strategic Move to Capture Professional Market

The acquisition is a key step in Home Depot’s broader strategy to grow its presence among professional customers such as electricians, roofers, and remodelers — a segment with more consistent, high-volume purchasing patterns than individual DIY shoppers.

“With this deal, we’re accelerating our efforts to become the go-to supplier for pros who rely on timely, large-scale deliveries,” the company said in a statement.

GMS distributes wallboard, ceilings, and other building materials across more than 300 branches in the U.S. and Canada. It has been a significant player in serving contractors working on commercial and residential construction projects.

Outbidding a Billionaire Rival

The announcement comes after a brewing bidding war between Home Depot and billionaire Brad Jacobs, whose company QXO made a competing $5 billion all-cash offer for GMS. Jacobs had signaled a willingness to pursue a hostile takeover if GMS management did not accept the offer. Home Depot’s successful bid effectively shuts down that challenge and solidifies its dominant position in the building supplies market.

Market Reaction and Outlook

Shares of Home Depot dipped slightly by nearly 1% on Monday, while GMS stock surged roughly 12%, hitting a new 52-week high on the news. Despite a sluggish retail market for home improvement due to high interest rates and a slowdown in DIY activity, Home Depot remains optimistic. It expects overall sales to rise 2.8% for the fiscal year, with comparable sales — which exclude temporary factors — growing by about 1%.

This acquisition reflects Home Depot’s growing reliance on professional customers, as higher borrowing costs have dampened homeowner appetite for large-scale projects. By bolstering its distribution capabilities and broadening its product reach, the company is making a calculated bet that the "pro" market will continue to offer resilience and long-term growth.

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