QUICKREAD

• Home Depot Acquires GMS for $5.5 Billion: Through its SRS Distribution unit, Home Depot will acquire GMS to create a 1,200-location, pro-focused distribution network spanning the U.S.
• Contractors to Benefit from Broader Reach and Better Service: The combined network promises faster deliveries, expanded product access, enhanced trade credit, and improved digital ordering tools tailored for pros.
• Leadership and Local Service to Remain Stable During Integration: GMS’s senior leadership and local teams will stay in place, ensuring business continuity while Home Depot and SRS integrate systems and scale operations.

On Monday, GMS, a distributor of wallboard, steel framing, and other specialty products, entered into a definitive agreement to be acquired by SRS Distribution, a subsidiary of home improvement retailer The Home Depot, in a transaction valued at approximately $5.5 billion, including net debt.

On June 30, the companies announced that Home Depot will initiate a cash tender offer to purchase all GMS shares at $110 each, valuing GMS at approximately $4.3 billion, representing a 36% premium over its share price as of June 18, 2025.

GMS shares surged 11% in premarket trading, climbing to $108.40, after the announcement, while Home Depot shares dipped less than one‑half of one percent, reflecting investor focus on near‑term leverage and integration risks. 

The transaction is expected to close by the end of Home Depot’s current fiscal year, January 31, 2026, subject to customary closing conditions, including regulatory approvals and tender of a majority of GMS shares, according to reporting by the Financial Times.

John C. Turner Jr., president and chief executive officer of GMS, said the deal “delivers significant value to our shareholders, customers, suppliers and team” and positions the company to “accelerate our growth” by leveraging SRS Distribution’s extensive professional‑contractor network. GMS’s senior leadership team will remain in place following the closing.

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Ted Decker, chair, president and chief executive officer of THD, said adding GMS to the SRS platform, acquired in 2024, will expand product offerings and distribution capabilities for professional customers. He noted that Home Depot’s prior acquisition of SRS has already generated “significant synergies” through cross‑selling and enterprise‑credit initiatives.

Founded in 1971 and based in Tucker, Ga., GMS operates more than 320 distribution centers and nearly 100 tool-sales, rental, and service locations nationwide. The distributor supplies wallboard, ceilings, steel framing and complementary construction products to residential and commercial contractors. 

SRS, headquartered in McKinney, Texas, currently operates over 800 locations under a family of local brands.

Home Depot intends to fund the acquisition through a combination of cash on hand and new debt, while maintaining its target leverage of approximately two times debt to adjusted EBITDA by the end of fiscal 2026. 

“The combination of GMS and SRS will provide the residential and commercial professional contractor customer with more fulfillment and service options than ever before,” Dan Tinker, CEO of SRS, said in the news release.

“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," he added. 

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What Can Contractors Expect?

Based on THD’s assumption of SRS, Contractors working with the new GMS can look forward to several concrete benefits — and a few integration challenges — as the Home Depot‑backed merger moves forward:

Broader product selection and faster deliveries.

With the combined network now totaling over 1,200 locations and some 8,000 delivery trucks, contractors will gain easier access to both standard and hard‑to‑find building materials. 

“Most of the roofing products that SRS sells already are in the Home Depot catalog, but SRS might be able to help with some more obscure products,” noted Craig Webb, president of Webb Analytics, whose comments on the SRS acquisition seem applicable to GMS as well. 

MarketWatch analysis noted that an expanded last-mile footprint should shave days off delivery times, allowing crews to keep jobs on schedule.

Improved trade‑credit terms.

Unlike Home Depot’s traditional retail-oriented cash-and-carry model, SRS and GMS have extensive experience in extending net-30 and longer-term credit to professional customers. 

Webb added during the SRS transition that, during an analyst call, “Home Depot people even said they could see SRS taking over all management of trade credit for The Home Depot,” a shift that could free up contractor cash flow and simplify invoicing.

Enhanced digital tools and ordering.

The merger is expected to turbocharge the ongoing rollout of SRS’s technology — including online ordering portals, inventory-tracking apps, and integrated billing — across the Home Depot and SRS platforms. 

According to MarketWatch, Home Depot is betting these digital investments will create “tailored solutions to contractors working on large‑scale projects,” improving order accuracy and reducing back‑and‑forth. 

Continued Local Service and Leadership 

GMS, like SRS’s current management team and branch-level staff, will remain in place, helping to ensure continuity of customer relationships and minimize disruption on active projects. That means contractors can expect to have familiar points of contact, even as corporate systems are harmonized.

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Potential Teething Pains

As with any deal of this scale, some growing pains are likely — system migrations, SKU rationalizations and regional pricing adjustments may cause temporary confusion. However, both Home Depot and SRS have pledged to maintain steady service levels during the integration.

Bottom line: contractors can anticipate faster deliveries, a broader product catalog, more flexible credit, and enhanced digital tools, all backed by a single, coast-to-coast, pro-focused distribution platform — with the usual, short-lived hiccups that come with combining two large networks.

Jefferies LLC is acting as financial advisor, and Alston & Bird LLP and Richards, Layton & Finger P.A. are legal advisors to GMS. The Alston & Bird team was led by Scott Ortwein, Justin Howard, and Kyle Healy (Corporate & Business Transactions).