By Connor Hart


Home Depot will buy building-products distributor GMS for about $4.3 billion, winning a bidding war over roofing-products distributor QXO.

Under terms of the deal, the home-improvement company will purchase all outstanding shares of GMS's common stock for $110 apiece. Including debt, the transaction is valued at about $5.5 billion.

The buy represents a 36% premium to GMS's unaffected share price as of June 18, GMS said Monday.

Shares of GMS jumped 11%, to $108.25, in premarket trading. Through Friday's close, the stock is up nearly 25% in the past year.

GMS, based in Tucker, Ga., has a network of more than 320 distribution centers with product offerings including wallboard, ceilings, steel framing and other construction items. It also runs about 100 tool sales, rental and service centers for residential and commercial contract customers.

With Monday's deal, Home Depot beat out serial dealmaker Brad Jacobs, whose QXO had previously submitted an unsolicited proposal to buy GMS for about $5 billion, offering $95.20 a share in cash.

Home Depot will buy GMS through its subsidiary SRS Distribution, which it bought last year for more than $18 billion, including debt. The company purchased SRS, which sells goods for professional roofing and other building projects, in a bid to grab more spending from contractors and construction firms.

SRS said its purchase of GMS will accelerate the firm's goal of becoming a leading, multi-category building materials distributor by adding a new vertical that is adjacent to its existing business.

The company will fund the deal, expected to be completed by the end of this fiscal year, using cash on hand and debt. The transaction is expected to provide a boost to adjusted per-share earnings in the first year following closing, the company said.

"The combination of GMS and SRS will provide the residential and commercial Pro customer with more fulfillment and service options than ever before," SRS Chief Executive Dan Tinker said. "Together, we'll create a network of more than 1,200 locations and a fleet of more than 8,000 trucks capable of making tens of thousands of jobsite deliveries per day."

Both Home Depot and QXO have been attempting to corner a larger share of the heavily fragmented market for construction supplies and tools, betting a bigger company with better technology can win more contractors. The Wall Street Journal previously reported that long-term trends, such as the need for more housing in the U.S., bode well for GMS's growth, despite current tariff and economic uncertainty having hampered results so far this year.


Write to Connor Hart at connor.hart@wsj.com


(END) Dow Jones Newswires

06-30-25 0928ET