It was announced yesterday that after 4 attempts over the past 27 years Stanley Works has finally acquired Black & Decker in a $4.5 billion deal ($3.5bn stock & $1bn debt). Unfortunately this means about 4,000 additional jobs (10% of work force) will be cut from the business that has already seen dramatic cuts. Shareholders of Black & Decker will get 1.275 shares of Stanley stock and should see an increase in overall shareholder value from the merger.
Stanley buys and sells companies faster than I can keep track, last year they sold CST/David White to Bosch Tools. It will be very interesting to see what shakes out from this deal. There are many arrangements behind the scenes with companies that have deals with Black & Decker to supply motors, parts, etc and they could potentially loose them under the Stanley brand. I guess the big question will be how will this effect the quality of the tools for DeWalt, Porter Cable and other brands. Black & Decker has had some problems in recent years with their loyal customers being disappointed in degrading quality. Is Stanley the answer?
In addition, both companies will host a joint investor lunch on Tuesday, November 3, 2009 at 12:00 p.m. ET in New York City. The live webcast of the meeting can be accessed at www.stanleyblackanddecker.com, www.stanleyworks.com and www.blackanddecker.com. Read the Full Press Release Below:
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