[Fox Business] Home Depot bulks up Pro-business with $18.25B deal for building products supplier SRS

Home Depot will buy building materials supplier SRS Distribution in an $18.25 billion deal, in the top U.S. home improvement chain’s largest deal as it looks to broaden its professional customer base to better tackle tepid demand.

The company and rival Lowe’s Cos. have projected a slower recovery this year as U.S. consumers pause big home remodeling and renovation projects due to sticky inflation.

This has put pressure on the Do-It-Yourself (DIY) segment, which makes up about half of Home Depot’s business, and the company has sharpened its focus on “Pro-customers” such as professional builders, contractors, handymen to drive sales.

Thursday’s deal will expand Home Depot’s total potential market by about $50 billion to roughly $1 trillion, the company said. In 2020, Home Depot had bought back industrial materials wholesaler HD Supply Holdings in an $8 billion deal.

SRS, a portfolio company of private equity firms Leonard Green & Partners and Berkshire Partners, serves Pro-customers including roofers, landscapers and pool contractors. It will operate as an independent unit within Home Depot under its current leadership team.

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Leonard Green had bought a majority stake in SRS in a $3.55 billion deal in 2018, a person familiar with the matter told Reuters on Thursday.

Last December, Leonard Green allowed some of its fund investors to cash out of SRS at a valuation of about $16 billion, including debt, the source said, adding Home Depot agreed to the deal following a sale process for the company.

“This is a great deal at a great time,” said Thomas Hayes, chairman at Great Hill Capital.

“You need (to) only look to the housing shortage – and young demographics of our millennials – to understand that as rates moderate construction will boom,” he said.

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Shares of Home Depot, which has a market value of $382.42 billion according to LSEG data, were flat in early trading.

The acquisition will add SRS’ network of more than 2,500 professional sales force in 760 plus locations to Home Depot’s footprint of more than 2,000 U.S. stores and distribution centers.

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The deal, which would involve taking on the debt of SRS, will be funded with cash on hand and debt and is expected to close by the end of fiscal 2024.

SRS, which raked in $10 billion in revenue in 2023, has been on an acquisition spree. It closed 17 deals in the past three years focused on roofing, metal and building materials suppliers, according to its website.

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[Fox Business] EV maker slashes prices as it tries to avoid bankruptcy

California-based electric vehicle startup Fisker slashed the prices of some of its vehicles as it fights to avoid bankruptcy after a potential deal with another automaker fell through. 

The manufacturer’s suggested retail price for the 2023 Ocean electric SUV lineup in the U.S., which is equipped with Fisker’s 2024 Ocean OS software version 2.0, fell by tens of thousands of dollars.

Fisker lowered the MSRP for the 2023 Ocean Extreme trim from $61,499 to $37,499, the company said Wednesday. The 2023 Ultra trim will be priced at $34,999, down from $52,999, and the 2023 Sport will be priced at $24,999, down from $38,999, according to the automaker.

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The company said some of its Ocean vehicles have as much as $7,000 worth of additional options that are included in the discounted prices, which will take effect on Friday. 

Fisker said in a statement that it “is strategically positioning the all-electric Ocean SUV to be a more affordable and compelling EV choice, competitively available to EV buyers in the broadest possible market, and constantly improving via frequent Over-the-air (OTA) software updates.” 

Still, industry analysts believe the company could fall victim to bankruptcy. 

“It’s sad to see any company go bankrupt, but we expect to see more of them in the EV space,” Thomas Hayes, chairman at hedge fund Great Hill Capital, told FOX Business. “At the end of the day, it is unclear whether people actually want EVs, or they simply want Teslas.” Hayes said there is a difference because one is a commodity and one – Tesla – is a brand, lifestyle and ideology.

“That said, in the EV space – over time – there will be Tesla and the major incumbent ICE [internal combustion engine] producing OEMs [original equipment manufacturers] left standing, namely those OEMs who continue to choose to – or are forced by governments – to produce EVs,” such as General Motors, he added. 

The news came just days after the New York Stock Exchange announced that it would delist Fisker’s shares, saying that the “stock is no longer suitable for listing based on abnormally low price levels.” 

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According to a filing with the Securities and Exchange Commission (SEC), the unnamed automaker that had been in talks to make a deal with Fisker had terminated negotiations on March 22. 

Since then, Fisker has been forced to evaluate strategic alternatives, which may include in or out of court restructurings and capital markets transactions. 

If Fisker files for bankruptcy, it would be the second auto startup from CEO Henrik Fisker to fail. Fisker Automotive filed for bankruptcy in 2013. 

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[Fox Business] One injured after Frontier Airlines plane evacuated over ‘strong odor’: report

One person reportedly has been injured at Charlotte Douglas International Airport after a Frontier Airlines plane was evacuated due to a “strong odor.” 

The incident happened as Flight 1759 was set to depart Wednesday night to Orlando, Florida. 

“Yesterday evening as Flight 1759 was in the boarding process at Charlotte Douglas International Airport, a strong odor was detected throughout the aircraft. As a matter of precaution, the captain issued an evacuation notice,” Frontier Airlines told FOX Business in a statement. 

“Passengers exited the aircraft via both the jet bridge and evacuation slides. Initial reports indicate that no visible smoke or fire was observed,” the airline added. “All passengers will be re-accommodated on alternate flights.” 

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A person who evacuated the flight was transported to a local medical facility with minor injuries after suffering a fall, Queen City News reports.  

Images obtained by the station show the evacuation slide deployed in the rear of the plane as it was parked at the gate. 

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One passenger told Queen City News that they first smelled an odor onboard the plane – an Airbus A321neo – before the lights went off. 

“We extend our sincere apologies and concern for those impacted and are investigating the cause of the incident,” Frontier Airlines also said, noting that the plane had 226 passengers onboard. 

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The Federal Aviation Administration told FOX Business that the crew “reported the smell of smoke in the cabin” and it will be investigating the incident. 

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[Fox Business] Baltimore bridge collapse spotlights past disasters caused by ships

The recent collapse of the Francis Scott Key Bridge in Maryland has brought attention to other past instances of bridge incidents stemming from vessel hits.

The Francis Scott Key Bridge, which crossed the Patapsco River near Baltimore, sustained a hit from a large container ship early Tuesday morning, causing it to collapse.

The incident left six missing people presumed dead and is expected to impact the economy. 

The original Sunshine Skyway Bridge experienced a partial collapse that took the lives of nearly three dozen people over 43 years ago. Their ages reportedly ranged from 7 months old to 92 years old.

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That incident occurred after a massive ship ran into part of the bridge that goes over Florida’s Tampa Bay during a severe storm, according to the Tampa Bay Times. 

The ship involved in the collision was the Summit Venture. Conditions the Summit Venture had been trying to sail in at the time it hit the bridge included fog, rain and high-speed winds, the outlet reported.

About 1,200 feet of the bridge went into the water, the outlet reported. 

Authorities replaced the damaged Sunshine Skyway Bridge about seven years after the incident.

Another incident is the 2002 collapse of the Interstate 40 bridge near Webbers Falls, Oklahoma. 

In a report, the National Transportation Safety Board (NTSB) linked the collapse to a towboat that “veered off course and rammed” into the bridge. The roughly 100-foot towboat had been maneuvering a pair of barges. 

The collapse, which caused 14 deaths, affected about 500 feet of the bridge. Nearly 60 local, state and federal agencies were involved in responding to the incident.

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The Interstate 40 Bridge sustained about $30.1 million worth of damage, “including the operation of detours,” according to the NTSB. Meanwhile, damages to the barges amounted to $276,000.

The Big Bayou Canot bridge incident caused the deaths of 47 people. It took place in 1993.

All of those individuals had been traveling on an Amtrak train that partially fell into the water from the bridge near Mobile, Alabama, according to The Associated Press.

The railroad bridge became misaligned due to a hit from barges being transported by a towboat called Mauvilla. Fog and other factors contributed to the collision, according to an NTSB report published online by Wikimedia. 

Multiple train cars, including two for passengers and ones for baggage and sleeping, derailed in the incident, the report said. It has been called one of Amtrak’s worst-ever rail accidents in terms of fatalities, according to the AP.

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The incident led to damage and rerouting costs of over $19.08 million, according to the NTSB.

There have been other major bridge collapses. For example, the Interstate 35W bridge in Minneapolis experienced one in 2007 that stemmed from “inadequate load capacity” and weight loads on the bridge.

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