Home improvement retailer Lowe’s Companies, Inc. announced Nov. 3 it has agreed to sell its Canadian retail business to Sycamore partners — a private equity firm specializing in retail, consumer and distribution-related investments — for $400 million in cash, and performance-based deferred consideration.

Based in Boucherville, Quebec, Lowe’s Canadian retail business operates or services approximately 450 corporate and independent affiliate dealer stores in a number of complementary formats under different banners, which include RONA, Lowe’s Canada, Réno-Dépôt and Dick’s Lumber.

“The sale of our Canadian retail business is an important step toward simplifying the Lowe’s business model,” Lowe’s Chairman, President and CEO Marvin Ellison said. “We remain confident in our short and long-term outlook for the U.S. business, underscored by improved sales trends and strong profit flow-through in the third quarter, as well as our expectations for solid business performance for the remainder of 2022. I want to thank our entire Canadian team for their hard work and dedication to our customers. We look forward to working with Sycamore Partners in executing a seamless transition.”

“We are honored to partner with Lowe’s to establish Lowe’s Canada and RONA as a standalone company headquartered in Boucherville, Quebec,” Sycamore Partners Managing Director Stefan Kaluzny said. “We look forward to working with the company’s management team to build on its 83-year history as a leading Canadian home improvement business serving families, builders, and contractors in their communities across the country.”

The transaction is expected to close in early 2023, subject to customary closing conditions and regulatory approvals, according to a news release.