RONA INC.
TSX : RON

RONA INC.

September 15, 2010 09:00 ET

RONA Succession Plan a Major Success

Five Young Leaders Become Dealer-Owners With Support From RONA Development Fund

MONT-TREMBLANT, QUEBEC--(Marketwire - Sept. 15, 2010) - RONA inc. (TSX:RON), the largest Canadian distributor and retailer of hardware, renovation and gardening products, announced at its annual convention with affiliate dealer-owners in Quebec that its succession planning program has already started to bear fruit. This news comes less than a year after the introduction of this innovative program designed to make it easier for the families of independent retailers, RONA employees and aspiring entrepreneurs from other companies to acquire RONA stores. Five young leaders are the first to access support from the 10-year, $100 million development fund set up by RONA to finance the takeover plans of the next generation.

"The current state of our affiliate network reflects the aging of the Canadian population in general," said RONA president and CEO Robert Dutton. "If we want to maintain growth – and our key role as industry consolidator – we need to find and attract smart, dynamic young people from our organization or elsewhere. And we need to provide them with the tools they need to succeed as entrepreneurs. Our succession plan was designed to secure our leadership in the market and sustain the uninterrupted growth of our network. It also clearly demonstrates our deep commitment to the development of the affiliate dealer-owner network in Canada."

RONA is supporting five young leaders who will soon take over control of their own businesses. The first four approved projects are:

  • Marc-André Drouin, 37, and Nathalie Lagrange, 36
    Acquisition of two stores, in Sainte-Marie-de-Beauce and Saint-Elzéar.
    Their plan: consolidate the operations of both stores, invest to offer customers a better shopping experience by relocating the Sainte-Marie branch to a brand new building and continue to increase their competitiveness in the region.
  • Jean-Sébastien Saint-Pierre, 37
    Acquisition of a RONA store in Matagami, near James Bay.
    His plan: become his own boss, maintain the service quality and reputation of the store, which has been in operation for over 35 years, and pursue business relations with the Aboriginal communities in the region.
  • Marie-Pierre Breton, 24
    Acquisition of the Quincaillerie Maurice in Saint-Augustin-de-Desmaures.
    Her plan: build her own business and invest the resources required to become the best proximity hardware destination for the community.
  • Sergio Di Fruscia, 38
    Acquisition of a hardware store in the Montreal region.
    His plan: consolidate the positioning of the store in the neighbourhood and, in the medium term, acquire other stores.

The development of the affiliate network has always been a main growth vector for RONA. "Young people have a critical role in our preparations for the future because talent development is at the very heart of our business strategy. For RONA, preparing for the future means above all giving our people the tools for success. We get them ready to lead their own business and, together, to build the RONA of tomorrow," Dutton explained.

RONA succession plan

For family businesses like those in the fragmented hardware and home renovation industry, it can be especially difficult to prepare for succession. With this in mind, the RONA succession plan includes three components: personal, legal and financial. The program takes care of everything, from looking for potential successors to training and mentoring new owners. On the legal side, it provides resources to establish agreements and contracts. On the financial side, it covers the preparation of a business plan, tax planning and the financial structure for the purchase transaction. It also includes a $100 million development fund to facilitate the acquisition of stores over a 10-year period. The fund is financed by RONA affiliate dealer-owners and a consortium of leading Canadian financial institutions.

The program is off to an excellent start, with four projects approved, representing an investment of nearly $4 million. A number of other projects from all across Canada are currently in the review stage.

About RONA

RONA is the largest Canadian distributor and retailer of hardware, renovation and gardening products. RONA operates a network of nearly 700 corporate, franchise and affiliate stores of various sizes and formats. With close to 30,000 employees working under its family of banners in every region of Canada and more than 16 million square feet of retail space, the RONA store network generates over $6 billion in annual retail sales. For more information, please visit rona.ca.

Contact Information

  • Media:
    RONA inc.
    Daniel Richard
    Director, Corporate Communications
    514-599-5900, extension 5751
    daniel.richard@rona.ca
    or
    Financial Community:
    RONA inc.
    Stephane Milot
    Senior Director, Investor Relations
    514-599-5951
    stephane.milot@rona.ca