Rona says will sell assets, focus on distribution
By Euan Rocha and Allison Martell
(Reuters) - Canadian hardware retailer and distributor Rona Inc RON.TO will sell assets and simplify its operations as part of a back-to-its-roots strategy designed to turn its fortunes around, the company's interim chief executive said on Thursday.
Dominique Boies, who took the reins at Rona following last month's exit of long-time CEO Robert Dutton, said he plans to bring profit margins in line with industry standards with his changes, which will shift the company's focus back to its roots as a hardware distributor.
Rona, Canada's largest distributor and retailer of hardware, home renovation and gardening products, has grown through a series of strategic acquisitions.
But the Quebec-based company has stumbled in recent years amid strong competition from U.S. giants Home Depot (HD.N: Quote) and Lowe's Cos Inc (LOW.N: Quote). Earlier this year it was the target of an unsolicited C$1.8 billion ($1.8 billion) takeover proposal from Lowe's.
Lowe's withdrew its proposal in mid-September in the face of stiff opposition from both provincial politicians in Quebec and from many of Rona's independent dealers.
Dutton stepped down early last month, soon after the company announced another quarter of disappointing results.
His departure prompted speculation that the company could be back in play, but in an interview with Reuters on Thursday, Boies said Rona has had no discussions with Lowe's since rejecting the U.S. company's proposal earlier this year.
NEW DIRECTION Continued...