Stanley Black & Decker selling unit for $1.4BThe Associated Press | October 10,2012AP PHOTO
A Black & Decker Workmate bench is displayed at a store in Little Rock, Ark. Toolmaker Stanley Black & Decker Inc. announced Tuesday that it is selling its hardware and home-improvement business to Spectrum Brands Holdings Inc. for $1.4 billion in cash.NEW BRITAIN, Conn. — Tool maker Stanley Black & Decker Inc. is selling its hardware and home-improvement business to Spectrum Brands Holdings Inc. for $1.4 billion in cash.
The hardware and home-improvement unit makes locksets, hardware and faucets for residential use and includes brands such as Pfister, Baldwin and Kwikset.
Spectrum Brands, based in Madison, Wis., said that the acquisition will broaden its product offerings which include the Rayovac, Remington and Toastmaster brands.
Stanley Black & Decker, which is based in New Britain Conn., said the sale is part of its ongoing strategy to diversify its revenue and geographic reach. The hardware and home-improvement unit gets 90 percent of its revenue from North America and more than 50 percent of its revenue from U.S. home-improvement stores.
Both companies’ boards have approved the transaction.
Spectrum Brands shares climbed $4.76, or 11.6 percent, to $45.91 in midday trading. Stanley Black & Decker shares shed $1.35, or 1.8 percent, to $72.88.
Stanley Black & Decker anticipates the transaction will result in $1.3 billion in proceeds after taxes. It plans to use a majority of the proceeds to buy back shares and a smaller portion to reduce debt. The remaining proceeds, along with offshore capital, will be used to pay for its previously announced acquisition of Infastech, a Hong Kong company that makes fasteners.
Stanley Black & Decker says that the deal with Spectrum is not expected to change its financial outlook for 2012.
Spectrum, which is majority owned by Harbinger Group Inc., says the acquisition of the hardware and home-improvement business should add 75 cents to 80 cents per share in fiscal 2013 and add more than $1 per share in fiscal 2014, excluding one-time transaction and integration costs.
The hardware and home-improvement business will operate as a separate unit once the deal closes, which is expected during Spectrum’s first quarter in fiscal 2013.
It will be run by Greg Gluchowski, who currently serves as the unit’s president at Stanley Black & Decker. Gluchowski will report to Spectrum CEO David Lumley.
The deal announced Tuesday also includes certain assets of Taiwan’s Tong Lung Metal Industry Co., which makes residential and commercial locksets. Stanley Black & Decker purchased Tong Lung over for summer for about $100 million. Spectrum’s acquisition of the Tong Lung assets is anticipated to close in the second quarter.MORE IN National / World BusinessNEW YORK — To win the hearts of frequent business travelers, United Airlines is going through... Full Story
- Most Popular
- Most Emailed
- TOMORROW'S HEADLINES TODAY: Jim Jeffords' legacy, Brandon takes a few questions about proposed budget, beleaguered city playground likely to move, woman awakes to find strange man with knives standing at her bedside.
- TOMORROW'S HEADLINES TODAY: Former U.S. Senator James Jeffords dies Monday in Washington D.C., a local man is beaten and robbed while walking on West Street, Clarendon sets a tax rate and Brandon convenes an informational public meeting about its budget.
- RICHARD'S POOR ALMANACK: On this day in 1915, the New York World publishes scoop: Thom. Edison diverts chemical from war production to help German pharmaceutical company make aspirin; on this day in 1935, Will Rogers, Wiley Post die in Alaska plane crash.
- TOMORROW'S HEADLINES TODAY: State panel briefed on smuggling drugs into prisons; new French-German documentary about Vermont's heroin addiction; solar project at Vets Home falls apart; update dispute between Open Door Mission and treatment center.
- TODAY'S WEATHER MINUTE: Climatologists might not know as much about El Nino as they thought they knew. New studies show 10,000 years ago, El Nino was active, and polar ice sheets were rapidly melting — just like today.
- TOMORROW'S HEADLINES TODAY: State colleges get a budget cut break, vandals spray paint Wallingford basketball court, state's attorney will replace lost deputies, cop lawsuit proceeds, Mendon mini-golf proposal makes headway.