The Home Depot, Inc. (NYSE:HD) entered into an agreement to acquire HD Supply Holdings, Inc. (NasdaqGS:HDS) for $8.7 billion on November 15, 2020. Pursuant to the terms of the merger agreement, The Home Depot, Inc. agreed to commence a tender to purchase any and all of the outstanding shares of common stock at a price of $56 per Share net to the holder thereof, in cash, without interest thereon. The transaction is expected to be funded through cash on hand and debt. Following the consummation of the Offer, HD Supply Holdings, Inc. will become a wholly owned subsidiary of The Home Depot, Inc. HD Supply Holdings has agreed to pay The Home Depot a termination fee of $275 million in cash upon termination of the merger agreement. The Home Depot expects that Shane O'Kelly, Senior Vice President of The Home Depot, will lead the business of HD Supply following the Offer. Joseph J. DeAngelo, the Chairman and Chief Executive Officer of HD Supply, will leave the Company as a result of the transaction.

The deal is subject to customary closing conditions, including, among other things, (i) that at the expiration of the Offer a simple majority of all of the outstanding Shares be validly tendered and not withdrawn in accordance with the terms of the Offer (the “Minimum Condition”) and (ii) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”) and is subject to applicable regulatory approvals. The Offer is not subject to any financing condition. The Board of directors of HD Supply Holdings, Inc. and The Home Depot, Inc. approved the offer. The Boards of Directors of both The Home Depot, Inc. and HD Supply have unanimously approved the terms of the agreement, and the Board of Directors of HD Supply has resolved to recommend that shareholders accept the offer, once it is commenced. As of December 8, 2020, FTC granted the early termination notice. The acquisition is expected to be completed during The Home Depot, Inc.'s fiscal fourth quarter, which ends on January 31, 2021. The transaction is expected to be accretive to earnings in fiscal 2021.

David E. Shapiro, Samson Z. Mesele of Wachtell, Lipton, Rosen & Katz acted as legal advisors and J.P. Morgan Securities LLC served as exclusive financial advisor for The Home Depot, Inc. Robert A. Profusek and R. Kenneth Boehner of Jones Day acted as legal advisors and Goldman Sachs & Co. LLC acted as financial advisor and fairness opinion provider to HD Supply Holdings, Inc. D.F. King & Co., Inc. acted as an information agent and American Stock Transfer & Trust Company, LLC acted as depository bank for The Home Depot. Goldman Sachs will receive a fee of $44 million, $3 million of which became payable at announcement and the balance is contingent upon consummation of the transaction. Stephen M. Kotran of Sullivan & Cromwell LLP acted as a legal advisor to Goldman Sachs & Co. LLC.

The Home Depot, Inc. (NYSE:HD) completed the acquisition of HD Supply Holdings, Inc. (NasdaqGS:HDS) on December 24, 2020. As of the tender offer expiration date, a total of 127,928,897 shares had been validly tendered and not validly withdrawn, representing approximately 82.9% of the outstanding shares. In connection with the merger, all HD Supply shares not validly tendered have been cancelled and converted into the right to receive the same $56 in cash as will be paid for all HD Supply shares that were validly tendered and not validly withdrawn. The acquisition was funded through cash on hand, a portion of which was replaced with the proceeds from our issuance of $3 billion of senior notes in January 2021. All of the conditions of the offer have been satisfied. Shane O'Kelly, Senior Vice President, became Chief Executive Officer of the surviving corporation and Joseph J. DeAngelo, the Chairman and Chief Executive Officer, left. Also, Isabel Janci, Vice President - Investor Relations and Treasurer, became the Assistant Treasurer of the surviving corporation. The Board of Directors immediately prior, which consisted of Richard V. McPhail and Teresa Wynn Roseborough, became the Board of Directors of the surviving corporation. Accordingly, all Directors of HD Supply serving as of immediately prior ceased serving as Directors.