Lowe’s Companies has acquired Artisan Design Group (ADG) for $1.325 billion to fuel its services expansion plans.

ADG is a nationwide provider of design, distribution and installation services for interior surface finishes, including flooring, cabinets and countertops. The business recorded FY24 revenue of approximately $1.8 billion and has a network of more than 3200 specialized installers.

Lowe’s said the acquisition will help expand its ‘Pro’ offering into a new distribution channel.

“With more than 18 million homes needed in the United States by 2033, we expect new home construction will be a major driver of Pro planned spend for the next decade,” said Marvin Ellison, Lowe’s chairman, president and CEO.

“The acquisition of ADG allows us to build on our momentum with Pro planned spend and is expected to expand our total addressable market by approximately $50 billion,” he added.

Lowe’s will finance the acquisition with cash on hand. The transaction is expected to close in the second quarter, subject to regulatory approvals and other customary closing conditions.

Lowe’s reported a 3.1 per cent decline in sales to $83.67 billion in the year ended January 31, while its net earnings fell 10 per cent to $6.96 billion. However, an analyst said the retailer was  in a good place amid positive trends in the home improvement market.