Over the years, consumers have been able to head to three or four primary locations, in order to acquire their painting supplies. The majority of these individuals opt to head to one of the major home improvement stores, such as Home Depot or Lowe’s. When heading to the latter, consumers are nearly always forced to invest in Valspar paint. The brand has been synonymous with the retail chain for an extensive period of time, but that is all about to change. On March the 20th, it was reported by the Wall Street Journal and other news networks that Sherwin-Williams had agreed to purchase the Valspar Corporation. The changes could be dramatic and widespread.
Previously, Sherwin-Williams had a tremendously difficult time attempting to compete with Lowe’s and Home Dept. Since both sell their own signature brands, Sherwin-Williams was left out in the cold and consumers, who lived outside of a local retail store, were unable to acquire Sherwin-Williams paint. This will change, once the deal has been finalized and the changes take affect. In fact, this is one of the primary purposes of the purchase. Once they’re able to acquire Valspar, Sherwin-Williams will also be opening the door to Lowe’s. Of course, the Valspar brands itself is nothing to scoff about.
In fact, the Valspar stock has more than doubled within the past 5 years. Stock analysts have also raised their Q2 2016 earnings per share estimates for the company. Shareholders of VAL have already benefits enormous over the 5 years and their earnings will likely rocket even higher, thanks to the disclosure of the new landmark deal. Although Sherwin was able to finally break into Lowe’s last year, with their HGTV brand, the majority of their sells came directly from their own retail stores. Now, Sherwin will own the mass majority of Lowe’s paint supply, which will ultimately lead to massive profits and less competition.
How this will impact consumers remains to be seen. In all likelihood, Sherwin-Williams and Valspar paints will remain readily available at your local Lowe’s, but the prices could increase. On the flip side, things aren’t look too good for the big orange, Home Depot. Home Depot is well known in the United States and remains as one of the major home improvement retailers in the country. They offer pretty much everything you could ever need from plywood to flashlights and of course, kitchen faucets. Unfortunately for the retailer, their future may begin looking a little less orange and a little blacker.
In 2014, Home Depot was accused of a massive data breach, which affected around 50 million consumer credit card numbers, along with 53 million customer e-mail addresses. While, Home Depot continues to admit any wrongdoing or having any liability in the massive breach, the corporation agrees to settle the deal in U.S. District Court Northern District of Georgia. A total sum of 19.5 million will be distributed among 40 million victims. All in all, it appears that each victim will receive around $2,000 in compensation.
Well, there is one stipulation to this agreement. It seems that the victims will not even receive the $2,000 reimbursement, since $6.5 million will cover 18 months of identity protection. So, when you break the total amount down, by subtracting the $6.5 million, victims will be forced to settle with a $13 million reimbursement.
How will these changes impact Home Depot, Lowe’s and Sherwin-Williams? Only time will tell, but the future looks bleak for one and much brighter for another. Lowe’s will probably remain unaffected.