Stanley Black & Decker to acquire Newell Brands tools business
Stanley Black & Decker announced that it has entered into a definitive agreement to acquire the tools business of Newell Brands, which includes the industrial cutting, hand tool and power tool accessory brands Irwin and Lenox, for $1.95 billion in cash.
Newell Tools is an industry leader with an array of strong brands and products that are highly complementary to Stanley Black & Decker. With LTM revenues of approximately $760 million, and low to mid-single digit average sales growth since 2011, Newell Tools is well-positioned to enhance the offerings and broaden the reach of Stanley Black & Decker's global tools and storage business, the company said. Newell Tools operates a global manufacturing footprint, maintains strong distribution relationships in its served markets, and has more than 2,500 employees around the world.
Stanley Black & Decker's president and chief executive officer, James M. Loree commented, "Newell Tools is an important step in our quest to further strengthen our presence in the global tools industry. The addition of the iconic Lenox brand and very strong Irwin brand, as well as their associated power tool accessory and hand tool products, opens up exciting new sources of global growth in similar ways, albeit on a smaller scale, to what Black + Decker did in recent years. Thus, the acquisition of Newell Tools, our first major acquisition since 2013, will provide both a source of inorganic growth in year one and an organic boost thereafter. SFS 2.0, our operating system, with its growth enhancing elements of digital excellence, commercial excellence and breakthrough innovation will also be deployed to rev up organic growth. This transaction, with our multi-faceted approach to revenue expansion, is entirely consistent with our strategy of driving above-market growth in a low growth world."
Stanley Black & Decker expects the transaction to result in annual cost synergies of approximately $80 million to $90 million by year three.
The transaction, which is subject to customary closing conditions, including regulatory approvals, is expected to close in the first half of 2017.