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No decision yet on HD Supply

May 1, 2007

The Home Depot Inc.’s chief executive said no decision had been reached as to what to do with its wholesale distribution arm, despite HD’s announcement last winter that it was considering selling the unit, the Associated Press reported in March.

CEO Frank Blake said at a Merrill Lynch retailing conference in New York that the world’s largest home improvement store chain is simply considering alternatives for Home Depot Supply.

When the Atlanta-based company said Feb. 12 that it was considering shedding its division serving contractors, homebuilders and other business customers so that it could focus on its core retail business, some investors figured the supply unit would be sold.

Since then, Blake has suggested at various public events that Home Depot Supply is not necessarily gone just yet.

Home Depot has not said whether it has gotten any offers for Home Depot Supply.

Some analysts have said the decision to possibly sell Home Depot Supply could benefit the company by allowing it to focus on generating value for shareholders, while others have suggested it could put the onus back on the company’s retail side, where it faces tough competition from Lowe’s.

Home Depot Supply was a big focus of future growth for former Home Depot Chief Executive Bob Nardelli, who resigned in January after six years as head of the company.

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