Home Depot said it will pay $46.50 per outstanding share for Hughes Supply, a premium of nearly 21 percent over Hughes’ closing price Monday of $38.55. In addition, Home Depot will assume $285 million in net debt as part of the deal.

Hughes Supply will be part of The Home Depot Supply, a division that has built a leadership position in a range of markets serving business-to-business customers, such as homebuilders, professional contractors, municipalities and maintenance professionals. The addition of Hughes Supply more than doubles the size of The Home Depot Supply with projected 2006 combined sales approaching $12 billion.

?EUR??,,????'??By acquiring Hughes Supply, a company with a long and established reputation for excellence and service, we continue to execute our growth strategy laid out five years ago to enhance our core retail business, extend our business into adjacent areas and expand into new markets,” said Bob Nardelli, chairman, president & CEO of The Home Depot.

Founded in 1928, Hughes Supply is one of the nation?EUR??,,????'???s largest diversified wholesale distributors of construction, repair and maintenance-related products, with over 500 locations in 40 states.

“Home Depot Supply is well-positioned in the marketplace and possesses a wealth of resources to thrive in an industry where there are tremendous opportunities for growth,” said Hughes Supply CEO Tom Morgan. “This combination is positive for all of our constituents: creating significant shareholder value, increasing the opportunities available to our employees, continuing our commitment to superior service to customers and building on the foundation of strong vendor relationships.?EUR??,,????'??