Orchard, which is currently in Chapter 11 bankruptcy, notified Lowe’s that no other bids for the San-Jose, Calif.-based chain had been received by the Aug. 9 deadline. The transaction will be presented to the bankruptcy court for approval on Aug.20 with the acquisition completing by the end of August.
Lowe’s says it plans to operate Orchard as a separate, standalone business, retaining its brand under the leadership of Orchard’s current management team. Lowe’s plans to acquire the locations most complementary to its current strategy and store footprint.
Once completed, the acquisition will enable Lowe’s to expand its presence in California and reach a new customer base through the addition of Orchard’s smaller-format stores in densely populated areas.
Orchard’s neighborhood hardware and garden stores offer a product selection focused on paint, repair and backyard categories in approximately 36,000 square feet of selling space, compared to 113,000 square feet of selling space for an average Lowe’s home improvement store. Lowe’s currently operates 110 stores in California.
Lowe’s announced on June 17 that it entered into a purchase agreement with Orchard which would serve as the “stalking-horse bid” in a court-supervised auction. Based in San Jose, Calif., Orchard reported annual revenue of $657 million for fiscal 2012.