BRENTWOOD, TENN. — Tractor Supply Company recently closed its acquisition of Orscheln Farm and Home after receiving clearance from the Federal Trade Commission (FTC). The acquisition is estimated to be worth $320 million and is anticipated to generate a tax benefit of $20 million for Tractor Supply.
“Today is an important day for Tractor Supply as this acquisition expands our ability to better serve our customers in the Midwest,” said Hal Lawton, president and chief executive officer of Tractor Supply. “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.
“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,” Lawton added. “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.”
The acquisition includes all 166 of Orscheln’s stores, 81 of which Tractor Supply will keep and 85 of which the company will sell to two FTC-approved buyers as part of the agreement. The 81 stores retained by Tractor Supply are estimated to be worth about $238 million.
Shortly after the closing of the acquisition, Tractor Supply will sell the remaining 85 retail stores to Bomgaars Supply, which will receive 73 stores, and Buchheit Enterprises, Inc., which will receive 12 stores. The divested stores are expected to bring in $72 million for Tractor Supply. In addition, Tractor Supply will also sell Orscheln’s corporate headquarters and distribution center to Bogmaars for $10 million within 15 months of the closing of the acquisition.
“While agreeing to this remedy with the FTC took longer than we anticipated, the outcome is in line with our expectations,” Lawton said. “We are very pleased with the high-quality locations that will be converted to Tractor Supply stores. 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.”
During the next 15 months, Orscheln stores retained by Tractor Supply will be remodeled to fit under the company’s branding.
Tractor Supply’s fourth quarter and fiscal year 2022 net sales are expected to increase by $75 million as a result of the acquisition. For fiscal year 2023, the acquisition is anticipated to increase net sales by $300 million.
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