Lowe's Sells Canadian Operations

Home improvement retailer Lowe’s is selling its Canadian retail business to private equity firm Sycamore Partners in a cash deal valued at $400 million. 

Based in Boucherville, Quebec, Lowe's Canadian retail business operates or services approximately 450 corporate and independent affiliate dealer stores in a number of complementary formats under different banners, which include RONA, Lowe's Canada, Réno-Dépôt and Dick's Lumber.

"The sale of our Canadian retail business is an important step toward simplifying the Lowe's business model,” said Marvin R. Ellison, Lowe's chairman, president and CEO. “While this business represents approximately 7% of our full year 2022 sales outlook, it also represents approximately 60 basis points of dilution on our full year 2022 operating margin outlook."

While expressing confidence in the short- and long-term outlook for Lowe’s U.S. business, Ellison said the sale of the retailer’s Canadian operations allow the company to intensify its focus on enhancing operating margin, return on invested capital, taking market share in the U.S. and creating greater shareholder value.

The transaction is expected to close in early 2023, subject to customary closing conditions and regulatory approvals. In connection with the preparation of the company's financial statements for the third quarter of 2022, the company expects to record a pre-tax non-cash impairment charge of approximately $2.0 billion related to its Canadian retail business.