• Lowe’s non-binding proposal provides an attractive premium to RONA
  shareholders, compelling strategic logic for both companies and
  important commitments to RONA’s key stakeholders
• Under Lowe’s proposal RONA would remain a Quebec-based company with the
  Canadian head office in Boucherville, Quebec
• Lowe’s seeking friendly negotiation with RONA Board of Directors

MOORESVILLE, NC, July 31, 2012 /PRNewswire/ – Lowe’s Companies Inc.
(NYSE: LOW) (“Lowe’s” or the “Company”) confirmed today that it has
made a non-binding proposal to the Board of Directors of Canadian home
improvement and hardware retailer RONA Inc. (TSX: RON) (“RONA”) to
acquire all of the issued and outstanding common shares of RONA for
C$14.50 in cash per share. A number of institutional shareholders
representing in the aggregate approximately 15% of RONA’s outstanding
shares have indicated that they support Lowe’s proposal. The proposal,
which is subject to the satisfactory completion of confirmatory due
diligence, represented an attractive premium of 36.7% to the C$10.61
closing share price on July 6, 2012 and a premium of 42.4% to the
volume-weighted average share price of C$10.18 for the 20 trading days
ended July 6, 2012, the last trading day prior to the submission of the
Lowe’s proposal. However, the proposal was rejected by the Board of
Directors of RONA.

The non-binding proposal was delivered to RONA Board Chairman Mr. Robert
Par , on July 8^th, 2012. RONA’s Board asked Lowe’s for additional time to consider the
proposal but, subsequently, rejected it. In light of this decision,
Lowe’s is making its proposal public in its entirety to allow for all
RONA shareholders and other stakeholders to evaluate the numerous
economic and commercial benefits outlined in the proposal and to allow
for shareholders to communicate their views directly to RONA’s board.
Lowe’s proposal letter is appended in its entirety to this news
release.

At RONA’s request, the chief executive officers of Lowe’s and RONA first
met one year ago on July 27, 2011 to discuss a potential relationship
between the two companies. RONA’s CEO subsequently visited Lowe’s in
North Carolina to continue the initial discussions. Including these
initial meetings, the two companies have discussed or reviewed
proposals for a working arrangement between them, including a previous
proposal by Lowe’s to acquire RONA, dated December 15, 2011. That
proposal was rejected by the RONA board.

Robert A. Niblock, Chairman, President and Chief Executive Officer of
Lowe’s, said, “We are disappointed that RONA’s Board of Directors has
rejected our friendly non-binding proposal, which is clearly attractive
for RONA shareholders. We believe a combination of Lowe’s and RONA
makes enormous business sense. In addition, our proposal includes a
number of important commitments to RONA that will benefit key
stakeholders, including RONA’s dealer-owners, employees, suppliers,
customers and local communities and would keep RONA’s headquarters in
Boucherville, Quebec.”

“We reiterate our proposal to the RONA Board. We hope that in the
exercise of its fiduciary duties, RONA’s Board will reconsider and
recognize that our proposal represents a very attractive opportunity
for all RONA shareholders and the company’s major stakeholders. Lowe’s
operates with the utmost respect and support for the communities where
we do business and our proposal demonstrates Lowe’s respect for the
economic and cultural heritage of this important Quebec-based business.
Bottom line, we believe that our proposal is good for RONA and the
communities it serves in Quebec as well as across Canada, and it is
also good for consumers. We encourage the Board of RONA to reconsider
its position,” concluded Mr. Niblock.

Compelling Strategic Rationale and Commitments to RONA Stakeholders

In addition to the attractive premium offered to RONA’s shareholders,
the proposal is underpinned by a compelling strategic rationale and
commitments that benefit all stakeholders of both RONA and Lowe’s,
including customers.

Creation of a Strengthened Canadian Home Improvement Retailer with
World-Class Capabilities Headquartered in Quebec – Combining RONA’s Canadian operations with Lowe’s strong global
presence would provide RONA’s operations with substantial benefits by
creating a strengthened Canadian home improvement retailer with
world-class capabilities across channels and geographies. While the
combined Canadian business would undoubtedly benefit from Lowe’s global
reach and deep supplier relationships, Lowe’s believes that preserving
RONA’s local market expertise and relationships is critical.

Under Lowe’s proposal, RONA will remain a Quebec-based company and the
headquarters for the combined Canadian business will remain in
Boucherville, Quebec.

Share Best Practices and Leverage Strengths of Existing Employees – RONA and Lowe’s share strong organizational cultures and dedicated
managers and employees that are critical to the success of both their
businesses. By combining the talents of their people and sharing
organizational best practices, the combined companies create a stronger
platform for future growth and a great work environment. In order to
capitalize on the strong local market expertise within RONA, Lowe’s
intends for much of RONA’s management team to continue in leadership
roles, and intends to preserve the important role that dealer-owners
play in the management of RONA. Lowe’s also expects that the number of
people employed by RONA today, both within Quebec and across the rest
of Canada, would be the same or greater following the transaction and
believes that the combined entity would offer significantly enhanced
growth opportunities benefiting all of our employees.

Strengthened Multi-Channel Retail Strategy – While Lowe’s is best known for its traditional large store formats, the
Company would be committed to preserving and developing RONA’s
multi-channel retail strategy that includes retail, commercial and
distribution channels offered through large stores, smaller
urban/proximity format stores and a well-developed online presence
offered under a number of different brands. RONA is a renowned
Canadian brand and it is strategically and culturally desirable that
RONA stores and distribution operations continue to operate under the
RONA brand.

Enhanced Dealer-Owner Value Proposition – Combining Lowe’s and RONA’s operations would create a strengthened,
global home improvement retailer with more than C$57 billion in
aggregate annual sales – an organization that would be ranked among the
top 50 Fortune 500 companies. Lowe’s deep supplier relationships and
an enhanced product offering would create significant value for RONA’s
dealer-owners and better position the company to serve its customers.

Commitment to Local and Ethical Sourcing of Materials – Lowe’s understands and shares RONA’s commitment to procuring goods in
Canada wherever possible. During 2011, Lowe’s Canada procured
approximately 70% of its materials through Canadian suppliers. Lowe’s
will continue its local and ethical procurement strategy in the future
and would like to expand the relationships that both Lowe’s and RONA
have developed with Canadian manufacturers and suppliers. With its
leading global home improvement platform, Lowe’s believes that it is
also uniquely well-suited to increase the distribution of Canadian
manufactured products into new international markets.

Continued Commitment to Canadian Communities – Lowe’s is aware of and endorses the significant level of support that
RONA provides to communities across Canada through charitable
initiatives such as the RONA Foundation. Lowe’s shares the same
philosophy and is committed to supporting charitable initiatives
supported by RONA. Lowe’s Charitable and Educational Foundation has a
proud history of improving the communities it serves. Lowe’s commitment
is about more than writing cheques – it’s about its heritage of making
an impact in its communities.

Since Lowe’s was founded in 1946, the company has grown from a
small-town hardware store to a FORTUNE100 company, serving millions of
customers every week. The Company takes great pride in a culture built
on more than 65 years of exceptional customer service. It is a culture
shaped by more than 248,000 employees who are the foundation that
unites it and drives its success. Employees and leadership share a
vision and values that connect them with generations of Lowe’s
employees: a commitment to values – customer-focus, ownership in the
company, respect for each other, teamwork, a passion for execution and
integrity.

Lowe’s currently operates more than 1,745 stores in North America,
including 31 stores in Canada and three in Mexico, plus an additional
16 stores as part of a joint venture in Australia. As the company
continues to enter new markets, it is working harder than ever to
preserve and enhance its customer-focused culture and to carry on a
rich tradition of caring for the communities in which it operates and
where its employees live and work.

At this stage, there can be no assurance that any agreement will be
reached between the two companies or that any transaction will result
and Lowe’s non-binding proposal to the RONA Board is subject to
receiving access from RONA to perform satisfactory confirmatory due
diligence. Any transaction would also be subject to the satisfaction
of conditions, including the receipt of all necessary regulatory
approvals.

Lowe’s Companies Proposal Letter to the RONA Board (http://files.newswire.ca/324/Letter_Eng.pdf)

Proposal Fact Sheet (http://files.newswire.ca/324/Fact_Sheet_Eng.pdf)

Disclosure Regarding Forward-Looking Statements

This news release includes “forward-looking statements” including those
regarding Lowe’s non-binding proposal to RONA’s board of directors and
the expected impact of the proposed acquisition on Lowe’s strategic and
operational plans and financial results. Statements including words
such as “anticipate”, “believe”, “estimate” or “expect” and statements
in the future tense are forward-looking statements. Forward-looking
statements are subject to numerous assumptions, risks and uncertainties
that could cause actual events or actual future results to differ
materially from the expectations set forth in these forward-looking
statements. Although the company believes that the expectations,
opinions, projections, assumptions and comments reflected in
forward-looking statements are reasonable, it can give no assurance
that such statements will prove to be correct. Some of the factors
which could cause results to differ materially from the expectations
expressed in these forward-looking statements include the following:
the possibility that Lowe’s non-binding proposal to the RONA Board of
Directors to acquire RONA will be rejected by RONA’s board of directors
or, if applicable, shareholders; the possibility that even if Lowe’s
proposal is accepted, the proposed transaction will not close or that
the closing may be delayed; the failure to obtain, any necessary
actions to obtain and the timing to obtain any required regulatory
approvals for any transaction; the effect of the announcement of the
non-binding proposal on Lowe’s and RONA’s strategic relationships,
operating results and businesses generally; significant transaction
costs or unknown liabilities; failure to realize the expected benefits
of the combination; and general economic conditions. For more
information about these and other risks and uncertainties that we are
exposed to, you should read the “Risk Factors” and “Critical Accounting
Policies and Estimates” included in our Annual Report on Form 10-K to
the United States Securities and Exchange Commission (the “SEC”) and
the description of material changes therein or updated version thereof,
if any, included in our Quarterly Reports on Form 10-Q.

The forward-looking statements contained in this news release are based
upon data available as of the date of this release or other specified
date and speak only as of such date. All subsequent written and oral
forward-looking statements attributable to us or any person acting on
our behalf about any of the matters covered in this release are
qualified by these cautionary statements and in the “Risk Factors”
included in our Annual Report on Form 10-K to the SEC and the
description of material changes, if any, therein included in our
Quarterly Reports on Form 10-Q. We expressly disclaim any obligation to
update or revise any forward-looking statement, whether as a result of
new information, change in circumstances, future events, or otherwise,
except as required by law.

This announcement is for informational purposes only and does not
constitute an offer to purchase or a solicitation of an offer to sell
RONA common shares.

SOURCE Lowe’s Companies, Inc.

PDF available at: http://stream1.newswire.ca/media/2012/07/31/20120731_C3738_DOC_EN_16527.pdf

PDF available at: http://stream1.newswire.ca/media/2012/07/31/20120731_C3738_DOC_EN_16528.pdf