ATLANTA - The Home Depot Inc., the world's largest home improvement store chain, said Wednesday that the expected closing date of the sale of its wholesale distribution business has been extended by a week, but it warned there is no guarantee the deal will be completed.
The anticipated closing date of the $10.3 billion sale of HD Supply to a group of private equity firms was today, but that has now been extended to Aug. 23, Home Depot said in a Securities and Exchange Commission filing.
Both sides agreed to extend the closing date, Home Depot said.
The Atlanta-based company is in talks with the buyers about restructuring the sale agreement, which Home Depot has said could result in the price tag being reduced.
'No assurance can be given that any agreement will be reached concerning a restructuring of the proposed transaction nor that the transaction will close,' Home Depot said in the filing.
The news follows Home Depot's earnings release Tuesday in which it reported that it recorded a 14.8 percent drop in second-quarter profit.
The results beat Wall Street expectations, but Home Depot's shares fell nearly 5 percent after executives made comments that suggested to investors that the sale of HD Supply may not be a lock.
Chief Financial Officer Carol Tome said during an investor conference call Tuesday that Home Depot would have to cut by nearly half the size of its plan to repurchase up to $22.5 billion in company stock if the sale of its HD Supply unit falls through.
Later, she told The Associated Press she was 'just trying to do the math' for an analyst who asked her about the issue. Tome said any reduction in the stock repurchase plan would be subject to board approval.
At the same time, Tome told the AP that when the company sized its stock repurchase plan, it did so based on the expected proceeds from HD Supply.
Neither she nor Chief Executive Frank Blake said the agreement to sell HD Supply was in danger, but they did talk openly about the implications if the deal announced in June falls through.