Home Depot Closes China Stores

Atlanta-based The Home Depot is closing its remaining seven big box stores in China as the company shifts its focus in that market to specialty stores and online offerings.

As a result of the store closings, the company will record an after-tax charge of approximately $160 million in the third quarter of 2012, which includes impairment of goodwill and other assets, lease terminations, severance and other charges associated with closing the stores.

In place of the stores, the home improvement retailer is maintaining a new formats team to continue research and development activities, as well as two recently-opened specialty stores – a paint and flooring store and a Home Decorators Collection store, both located in Tianjin. It’s also developing relationships with several Chinese e-commerce websites.

“We've learned a great deal over the last six years in China, and our new approach leverages that experience and reflects our continuing interest in providing value to Chinese customers, as well as our shareholders,” says Frank Blake, chairman and ceo, The Home Depot.