In what both companies are describing as a "friendly" takeover, Canadian home improvement chain Rona is set to be purchased by its U.S. counterpart Lowe's.
News of the proposed $3.2-billion acquisition, which was unanimously approved by the boards of both companies, was announced Feb. 3.
Rona, a major Canadian retailer and distributor of hardware and building materials, has about 500 corporate and independent affiliate dealer stores, plus nine distribution centres, which employ more than 22,000 people across Canada.
The Lowe's takeover gives the company a bigger foothold in Canada, especially in Quebec where Rona has a strong presence in the home improvement market.
Lowe's has agreed to key conditions in the deal, including a commitment to headquarter its Canadian business in Boucherville, Que., maintain RONA's multiple retail store banners, enhance distribution to independent retailers and to continue to employ the majority of its current employees and maintain key executives, according to a press release.
The deal must still receive shareholder and regulatory approvals in Canada and the U.S. before it goes through.
Lowe's Canada is currently constructing a store in Nanaimo North Town Centre as part of its expansion into western provinces, but there is also a RONA Home Centre serving south Nanaimo from its location at the corner of the Island Highway and Maki Road and it is uncertain if Lowe's will maintain that store over the long term.
Andrea Wong, with Lowe's national public relations, said it's too early to speculate on an outcome for the Nanaimo Rona store.
"It's a bit early to speculate on specific stores," Wong said. "I do encourage you to refer to the press release that have been made by Lowe's to Rona stores and I also encourage you to keep following the story."