BY Richard Summerfield
In a deal to expand its footing in the professional builders market, Lowe’s Co has agreed to acquire Foundation Building Materials, a distributor of drywall, insulation and other products, for approximately $8.8bn in cash. The transaction value reflects an adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) of 13.4x.
According to a statement announcing the deal, Lowe’s has secured $9bn in fully committed bridge financing from Bank of America, N.A. and Goldman Sachs & Co. LLC. The company expects to finance the acquisition through a combination of short-term and long-term debt and intends to maintain its current credit ratings. The transaction is expected to close in the fourth quarter of 2025, subject to customary closing conditions, including regulatory approval.
“With this acquisition, we are advancing our multi-year transformation of the Pro offering,” said Marvin R. Ellison, chairman, president and chief executive of Lowe’s. “It allows us to serve the large Pro planned spend within a $250 billion total addressable market and aligns perfectly with our Total Home strategy. FBM’s scalable, multi-trade distribution platform and strong leadership combined with our recent acquisition of ADG will significantly enhance our Pro offering. We’re excited to welcome the FBM team and strengthen our solutions for our growing Pro customers.”
“Joining Lowe’s is an exciting next step,” said Ruben Mendoza, president and chief executive of Foundation Building Materials. “Since 2011, we’ve built a leading position in drywall, ceiling systems, and metal framing, with proven success integrating acquisitions. Together with Lowe’s complementary products and incredible brand, we’ll offer a more comprehensive solution for Pro customers and accelerate growth.”
Foundation Building Materials is a leading North American distributor of interior building products, including drywall, metal framing, ceiling systems, commercial doors and hardware, insulation and complementary products serving large residential and commercial professionals in both new construction and repair and remodel applications. Since 2011, it has grown organically and inorganically to become an industry leader, with a network of over 370 locations in the US and Canada serving 40,000 Pro customers. In 2024, on a pro forma basis, the company generated approximately $6.5bn in revenue and $635m in adjusted EBITDA. It generated approximately 25 percent and 30 percent compound annual growth rate for revenue and adjusted EBITDA, respectively, from 2019 to 2024.
Lowe’s has completed a number of deals aimed at strengthening its offering for professional contractors and builders in recent years. In April, the company acquired Artisan Design for $1.33bn.
In addition to the deal for Foundation Building Materials, Lowe’s also reported its fiscal second-quarter financial results on Wednesday. The company posted an adjusted profit of $4.33 per share. Revenue totalled $23.96bn in the period, which met Wall Street’s expectations. The company has also raised its full-year sales outlook to a range of $84.5bn to $85.5bn.
News: Lowe's to buy Foundation Building Materials for $8.8 billion to boost contractor business