Lowe’s Drops $8.8B on Building Materials Giant in Bid to Woo Contractors

Lowe’s just made a massive play to win over the pros.

The home improvement retailer announced Wednesday that it’s buying Foundation Building Materials (FBM) — a California-based distributor of drywall, insulation, ceilings, metal framing and other interior construction supplies — for a cool $8.8 billion. The deal is Lowe’s second big acquisition in just a few months aimed squarely at home professionals, not weekend DIYers.

The news came the same day Lowe’s reported better-than-expected quarterly earnings, giving Wall Street a little boost of confidence that the company might finally be finding its footing in a sluggish housing market.

With higher mortgage rates keeping many homeowners from big remodeling jobs, Lowe’s has doubled down on attracting contractors and builders — customers who tend to spend a lot more, and more consistently, than casual shoppers.

Earlier this year, Lowe’s snapped up Artisan Design Group, a flooring and cabinetry installer. Now, by adding FBM and its 370+ locations across the US and Canada, Lowe’s is building out a serious professional supply network. FBM, owned by private equity firm American Securities, generated about $6.5 billion in sales last year.

“This acquisition is a game-changer for our pro strategy,” said CEO Marvin Ellison. “FBM’s scalable distribution platform and strong leadership, combined with our recent ADG acquisition, will massively enhance what we can offer contractors.”

For the quarter that ended Aug. 1, Lowe’s posted earnings of $4.33 per share, beating analyst estimates of $4.24. Revenue landed at $23.96 billion, roughly in line with expectations. Comparable sales ticked up 1.1%, with July showing the strongest growth.

CFO Brandon Sink said Lowe’s isn’t banking on a sudden DIY boom to lift sales — instead, it’s leaning heavily on online growth and the pro business to drive results this year.

Full-year guidance now sits at $84.5 billion to $85.5 billion in sales, slightly higher than before thanks to its acquisitions.

Lowe’s is far from alone in chasing the pro market. Rival Home Depot has been snapping up contractor-focused businesses too, including its massive $18.25 billion purchase of SRS Distribution last year and a $4.3 billion buyout of GMS this summer.

Analysts say the rush to grab pro suppliers is heating up.

“The urgency in the pro distributors market is clearly escalating,” wrote J.P. Morgan’s Christopher Horvers.

Lowe’s will finance the FBM deal with a mix of short- and long-term debt, backed by $9 billion in bridge financing from Bank of America and Goldman Sachs. The acquisition is expected to close in the fourth quarter of 2025, pending regulatory approval.

Bottom line: DIY may be slowing, but Lowe’s is betting billions that contractors will keep building — and they want to be the first stop for those supplies.

With input from Reuters, Axios, CNBC, and Bloomberg.