Done Deal: Lowe's completes sale of Canadian business

The RONA banner is being re-established as the premier Canadian home improvement retail brand.
Rona store
The RONA retail brand has served Canadian customers since 1939.

Canadian home improvement retailer RONA Inc. announced that it has “re-established itself” as an independent industry player following its acquisition by private equity firm Sycamore Partners.

The New York-based firm, specialing in retail, consumer, and distribution-related investments, completed its acquisition of Lowe’s Canadian business on Feb. 3. 

Stores that operated under the Lowe’s banner will all eventually be converted to the RONA brand, which is based in Boucherville, Quebec.

The RONA fleet of stores, all included in the acquisition, consists of 450 corporate and independent affiliate dealer stores operating under the Rona, Lowe’s, Réno-Dépôt, and Dick’s Lumber. The RONA brand has served Canada for more than 80 years and was established in Quebec in 1939.

RONA noted that it will still offer Lowe’s private label brands while honoring warranties and gift cards issued by Lowe’s Canada.

“The senior leadership team and I are very excited to begin this new chapter in the history of Rona band that is valued by DIYers and contractors across the country,” said Tony Cioffi, president of RONA inc. “This milestone is positive for all our stakeholders, including our employees, affiliated dealers, vendors, customers, and the communities where we operate. We look forward to a bright future and believe this will be a unique opportunity for our 26,000 employees to promote the RONA name and increase the visibility of this strong brand among consumers.”

In January 2022, Cioffi was appointed president of Lowe’s Canada this past January and succeeded Tony Hurst who moved to U.S. operations after being named Lowe’s senior vice president of pro, services, and international.

But in a surprising announcement last November, Lowe’s announced that it was selling Lowe’s Canada to Sycamore Partners for $400 million in cash and performance-based deferred consideration.

The sale translates into Lowe’s paying a much higher ticket price to exit Canada than it did to make its major entry into the nation. 

In 2016, Lowe’s paid $2.4 billion to complete its acquisition of RONA. At the time, RONA was a thriving, independent Canadian home improvement retailer that essentially set the stage for Lowe’s Canada’s business model. 

Prior to being purchased by Lowe’s, RONA had entertained thoughts of entering the United States.

At the time of announcing the sale, which marked the end of Lowes international retail efforts, Chairman, CEO, and President Marvin Ellison said, By executing this transaction, we will intensify our focus on enhancing our operating margin and ROIC, taking market share in the U.S. and creating greater shareholder value.

Tony Cioffi Lowe's Canada
Tony Cioffi will continue to lead RONA as company president.

In a statement issued by Rona and Sycamore Partners, the retailer said it “will maintain a strong commitment to its RONA affiliated dealer network and to its Canadian- and Quebec-based vendors, including through its ongoing involvement with the ‘Well Made Here’ initiative, intended to encourage the purchase of domestically manufactured quality products.”

Since 2001, RONA has been one of the leading employers in the Montreal region.

“We are honored that Lowe’s has entrusted Sycamore Partners to lead RONA into its next chapter and build upon RONA's 84-year history serving communities across Canada,” said Stefan Kaluzny, managing director of Sycamore Partners. “We look forward to working with RONA's 26,000 associates and over 200 dealer partners to meet the home improvement needs of Canadian families, builders, and contractors.”

Sycamore Partners is based in New York with approximately $10 billion in aggregate committed capital.

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