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BOUCHERVILLE, QUE. — Home-renovation company Rona Inc. has acquired Noble Trade Inc., one of largest plumbing and heating supply wholesalers in Ontario, in a move to diversify the Quebec company's business.
Financial details of the deal, announced early Wednesday, were not disclosed.
The transaction is expected to close in the second quarter and will immediately add to Rona's bottom line.
Noble Trade is a nine-year old private company with sales of about $150-million in the last year and a workforce of more than 300 people at 19 retail branches and one distribution centre in Ontario.
Like many specialized supply companies, Noble has cashed in on the strong Ontario housing market to boost sales, especially around the Toronto area.
“This transaction is perfectly in line with our strategic development plan,” Rona president and CEO Robert Dutton said in a release before stock markets opened.
“Following the acquisitions of Materiaux Coupal, Chester Dawe and Curtis Lumber in 2006, adding Noble Trade to our network enhances our presence in the specialized commercial and professional market.”
Mr. Dutton said the purchase “is a solid platform for pursuing our expansion into this market with strong consolidation potential.”
“The transaction will also allow us to diversify our customer base and smooth the cyclical variations inherent to the retail market.”
Rona said Noble Trade president Michael Storfer will stay with Rona and manage the plumbing business along with his management team.
“We're convinced that the transaction will lead to development opportunities for our employees as well as a stimulating work environment,” Mr. Storfer said. “We're very enthusiastic about linking up with a company that can support our development through the coming years.”
More than half of Noble Trade's 19 branches are in the Toronto area, with other operations in Barrie, Belleville, Guelph, Hamilton, Kitchener, Kingston, London, St. Catharines and Windsor.
The warehouse is in Concord, just north of Toronto.
Rona is the largest Canadian distributor and retailer of hardware, home renovation and gardening products, with 620 franchise, affiliate and corporate stores across the country. The company has a workforce of more than 25,000 employees and generated $5.7-billion in annual sales last year.
In Wednesday trading on the Toronto Stock Exchange, Rona shares rose three cents to $22.37.
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