Home Depot To Jumpstart China Expansion
Home Depot To Jumpstart China Expansion
Jason Sandefur
The Home Depot is making a US$100 million bid to establish a presence in China by acquiring Tianjin-based Home Way, the Oriental Morning Post reported.
The move come a week after Home Depot announced it would rename all of its wholesale distribution businesses HD Supply. Including in that move were Home Depot-owned fastener companies Crown Bolt Inc., Brampton Fastener Co. Ltd. and Western Fasteners.
If approved by China’s ministry of commerce, the deal will allow Home Depot to obtain all 14 of Home Way’s outlets. Approval could take three months.
China’s home improvement market has an estimated annual worth of 300 billion yuan (US$37.5b), with market value expected to reach 1 trillion yuan by 2010.
Home Depot established its mainland headquarters in Shanghai in 2004, but the U.S. home improvement giant still doesn’t have any outlets in the city. By contrast, domestic home improvement hypermarket chain B&Q operates 10 Shanghai stores. Most of the Home Way outlets are in medium-sized cities.
Home Depot has 2,088 retail stores in the U.S., Puerto Rico, U.S. Virgin Islands, Canada and Mexico. Home Depot reported 2005 sales of $81.5 billion and earnings of $5.8 billion. Web: homedepot.com �2006 FastenerNews.com
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