Lowe’s is making a big move to keep up with rival The Home Depot. The home improvement giant has announced plans to buy Foundation Building Materials (FBM) — a California-based distributor with 370 locations across the country — in a deal worth $8.8 billion.
This purchase is expected to close by the fourth quarter of the year and will give Lowe’s more products to sell and better control over how they get to customers.
What FBM brings to the table
FBM specializes in interior building materials like ceiling systems, drywall, and insulation. By buying the company, Lowe’s will have exclusive access to these products, meaning shoppers can expect new items to hit store shelves soon.
The deal will also give Lowe’s direct access to FBM’s distribution network, helping the company move materials faster and more efficiently. This is especially important for the professional builders’ market, which relies on steady supply chains to finish jobs on time.
Lowe’s Chairman Marvin Ellison said the acquisition is meant to better serve these pro customers — the contractors and builders who shop for specific supplies to complete projects for their clients.
FBM’s recent success
FBM has been on a growth streak under its current owners, American Securities and CD&R. The company has posted 27% revenue growth in recent years.
FBM CEO Ruben Mendoza praised his team’s work and said joining Lowe’s will create “exciting opportunities ahead.” He added that FBM has expanded while staying true to its culture and values, something he expects to continue after the sale.
Keeping up with the Home Depot
This is a repeat of what The Home Depot did last year when it acquired SRS Distribution — Texas-based distributor that provides professional contractors with roofing, landscape, and pool maintenance supplies — for $18.25 billion.
That acquisition gave Home Depot a big boost with pro customers, and Lowe’s clearly wants to do the same. By adding FBM to its portfolio, Lowe’s is hoping to stay competitive in an industry that’s facing tight margins and fierce rivalry.
What this means for shoppers
For the average Lowe’s shopper, this deal could mean more product variety and better availability. With Lowe’s controlling FBM’s distribution, customers are less likely to face out-of-stock issues, and professional contractors can expect a wider range of materials in one place.
It’s also likely that Lowe’s will market these new offerings as exclusive items, giving shoppers more reasons to choose Lowe’s over other home improvement stores.
A growing focus on pros
Both Lowe’s and Home Depot have been shifting their strategies to focus on professional builders and contractors, who tend to spend more money per visit than DIY homeowners.
Lowe’s has already rolled out programs like MyLowe’s Rewards, which gives members perks like bonus points and free shipping at different reward tiers. This FBM purchase is the next step in showing professional customers that Lowe’s is serious about becoming a one-stop shop.
The bottom line
The $8.8 billion purchase of FBM is a clear sign Lowe’s isn’t letting Home Depot dominate the pro builder market without a fight.
With 370 new distribution points, exclusive building materials, and a faster supply chain, Lowe’s is positioning itself as a stronger partner for contractors—and an even more attractive destination for everyday shoppers looking for home improvement essentials.
As the deal moves forward, Lowe’s customers should start to see new products in stores and online by the end of the year.
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