BOUCHERVILLE, Que. & RED DEER, Alta. ― Lowe’s Canada has announced the signing of an asset purchase agreement to sell, through RONA Inc., the assets of the Ace Canada business to Peavey Industries. As part of the transaction, RONA, which is part of the Lowe’s Canada group, will assign to Peavey the licence and distribution agreements between RONA and Ace Hardware International Holdings, Ltd., which is in turn a subsidiary of Ace Hardware Corp.
Peavey, which is headquartered in Red Deer, Alta., with 92 stores from Ontario to British Columbia, will take over the Ace Hardware brands in Canada, plus a corporate Ace store in The Pas, Man. The agreement also transfers to Peavey the agreements with 104 independent Ace Hardware stores in Canada, which have been supplied through the wholesale business of RONA. Peavey will gradually assume responsibility for those stores over a six-month transition period to ensure no interruption of service. In addition, Peavey will take over the Ace Canada retail operating systems and the Ace Canada website.
Lowe’s Canada will continue to act as a wholesaler of lumber and building materials for Peavey Industries’ independent dealers after the transition period. The financial terms of the transaction are not being disclosed.
The Ace business represents less than 10 percent of the total sales volume of Lowe’s Canada’s affiliated dealer division, says Tony Cioffi, executive vice-president, finance, affiliate dealers, Dick’s and real estate for Lowe’s Canada. The sale will also help the company focus more directly on the RONA affiliated dealer base. “This transaction is in line with our plan that was announced last November to simplify our multiple store banners in order to drive efficiency and reduce operational complexity,” he added.
