Tractor Supply Co. Acquires Orscheln Farm and Home – PetProductNews.com

Tractor Supply Co., a rural lifestyle retailer that sells a mix of products for home, land, pets and animals, and also owns and operates pet specialty supply retailer Petsense, has closed on its acquisition of Orscheln Farm and Home. The company acquired a net 81 stores and divested the remaining 85 stores to two buyers approved by the Federal Trade Comission (FTC). The net purchase price of the 81 stores acquired and retained is approximately $238 million before working capital adjustments. The acquisition is anticipated to generate an estimated future tax benefit of approximately $20 million.
Orscheln Farm and Home offers farm and ranch supplies, lawn and garden supplies, power equipment, livestock supplies and feed, pet care, automotive, tools, fencing supplies, clothing and footwear, and sporting goods. Orscheln Farm and Home has an extensive pet care product selection that includes supplies for dogs, cats, small animals, birds, and wild birds.
“Today is an important day for Tractor Supply as this acquisition expands our ability to better serve our customers in the Midwest. We are committed to providing customers in the region with an elevated product assortment, a meaningful loyalty offering, an enhanced digital shopping experience and so much more that Tractor Supply is able to offer,” said Hal Lawton, Tractor Supply’s president and CEO. “Importantly, Tractor Supply is on track to achieve several monumental milestones in the growth of our company including annual revenues in excess of $14 billion, a store base of over 2,100 Tractor Supply locations and a highly engaged workforce of 50,000 team members. We are excited to build on our track record of long-term growth as we look to unlock revenue and earnings opportunities with this attractive acquisition that enhances our growth profile.
“While agreeing to this remedy with the FTC took longer than we anticipated, the outcome is in line with our expectations. We are very pleased with the high-quality locations that will be converted to Tractor Supply stores,” Lawton added. “I want to thank the Team members from both companies for their contributions and focus on caring for our customers during the extended review with the FTC. With a shared culture and values, we are excited to welcome the team to Tractor Supply and look forward to an exciting future going forward. We are honored to build on the legacy of Barry Orscheln and the team.”
The deal is an all-cash transaction that Tractor Supply anticipates financing through its balance sheet. The company acquired 166 Orscheln Farm and Home stores for approximately $320 million, before working capital adjustments. As part of the remedy reached with the FTC, Tractor Supply will divest 85 locations to two buyers, Bomgaars Supply, Inc. (73 stores) and Buchheit Enterprises, Inc. (12 stores), shortly after closing the transaction, company officials said. Proceeds of the store divestitures will be approximately $72 million. In addition, Tractor Supply has agreed to sell the Orscheln Farm and Home corporate headquarters and distribution center to Bomgaars for approximately $10 million within 15 months after the closing of the transaction.
The store divestitures and sale of the corporate headquarters and distribution center bring the net purchase price of the 81 stores acquired to approximately $238 million, before working capital adjustments. The acquisition is anticipated to generate an estimated future tax benefit of approximately $20 million.
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