While it may seem like eons have passed since the construction materials distribution industry felt a tremor following The Home Depot's plan to acquire SRS Distribution, the deal was only announced at the end of March, and yesterday, one of the last regulatory hurdles was finally met.
In a brief news release today, Home Depot announced the expiration of a mandatory waiting period required under the Hart-Scott-Rodino Antitrust Improvements Act. Home Depot said the waiting period expired “at 11:59 p.m. on June 13, 2024.”
The company said the expiration of the waiting period under the HSR Act satisfies “an important condition necessary for the completion of the transaction.”
The HSR Act is an amendment to the Clayton Antitrust Act and was enacted in 1976 to provide federal agencies with a specific amount of time to conduct antitrust reviews of proposed mergers, acquisitions, and other significant business transactions that could potentially affect market competition.
The law mandates that parties involved in certain large transactions must file detailed notifications with the Federal Trade Commission and the Department of Justice and observe a waiting period before completing the transaction. The waiting period is typically 30 days, but under some circumstances, it may be reduced to as few as 15 days “for cash tender offers and bankruptcy sales” under the U.S. Code.
The HSR Act was enacted in response to growing concerns from lawmakers, economists, and the public, which began in the early 1960s, about an increasing concentration of economic power and the potential adverse effects of large mergers on competition.
Shortly, it will be a new era for SRS, founded in 2008 in McKinney, Texas, and which grew to become one of the country’s largest building materials distributors — and a member of roofing’s “Big Three.” SRS operates under distinct 'local' brands in more than 760 locations across 47 states.
Home Depot said the transaction is expected to close “on or about June 18, 2024, subject to the satisfaction or waiver of customary closing conditions.”
At press time, Home Depot, which trades on the New York Stock Exchange under the ticker symbol HD, was down 3 points, or just under 1%, at 344.76 on light trading. The company has a market cap exceeding $342B and is included in the Dow Jones industrial average and Standard & Poor's 500 index.
