Home Depot’s next acquisition would add critical building systems to its wholesale network as the company vies for more business from professional contractors.
SRS Distribution, a subsidiary of Vinings-based Home Depot, said Tuesday it has an agreement to buy Mingledorff’s Inc.
Peachtree Corners-based Mingledorff’s is a wholesale distributor of heating, ventilation and air conditioning equipment and supplies. Founded in 1939, the family-owned company today has 42 locations in five states across the Southeast.
Financial terms of the deal were not disclosed.
With the acquisition, Home Depot says it can add a product category with a $100 billion market to SRS. The home improvement giant bought SRS, a wholesale distributor of roofing, landscaping and pool supplies, for $18.3 billion in 2024.
HVAC systems are essential to maintaining air quality and temperatures in commercial and residential buildings.
“The addition of Mingledorff’s will give us an incredible opportunity to build an enterprise-wide platform in HVAC equipment, replacement parts and supplies, creating another entry point into the broader distribution space,” Ted Decker, chair, president and CEO of Home Depot, said in an announcement Tuesday.
About half of Home Depot’s business is from contractors, executives have said.
But the company is making a big play for more spending from contractors, especially amid a slow housing market and lingering consumer uncertainty that has impacted demand for its retail business.
“We are going to do for wholesale what Bernie and Arthur did for retail,” Billy Bastek, Home Depot’s executive vice president of merchandising, said at a supplier conference last October. He was referring to two of the company’s founders, Bernie Marcus and Arthur Blank.
Home Depot last year also spent $5.5 billion to acquire Tucker-based GMS Inc., a distributor of specialty building products including drywall, ceilings and steel framing.
And the company has launched a suite of digital products to simplify tasks for contractors, such as a project planning tool.
Decker last year hinted Home Depot could explore more acquisitions. SRS also has a history of acquiring small, often family-owned companies, according to CNBC.
“We’ll look at opportunities, always, on a case-by-case basis,” Decker said at an annual Goldman Sachs retailing conference.
The Mingledorff’s deal is expected to close in the second quarter, subject to closing conditions and regulatory approvals. Home Depot said it expects to fund the purchase with cash on hand and debt.
David Kesterton, president and CEO of Mingledorff’s, will continue to lead the company, Home Depot said.
“Joining forces with SRS and The Home Depot marks an incredible new chapter in our company’s history and gives us a powerful platform to broaden our reach and impact,” Kesterton said in the announcement.
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