Stanley Black & Decker Tuesday announced that it will sell its Hardware & Home Improvement Group (HHI) to Spectrum Brands Holdings for $1.4 billion in cash. The transaction is expected to be finalized during 1Q 2013.
The hardware and plumbing maker says it plans to use more than one-half of the earnings from the sale to repurchase shares, a smaller portion of the earnings to reduce debt, and the rest to fund its acquisition of Infastech, a fastener maker with a foothold in the Asian market.
This, as the segment's parent company looks for new opportunities to sell in international markets, The New York Times reports.
"While HHI is a healthy and profitable business, its characteristics are inconsistent with Stanley Black & Decker’s strategic objectives of diversifying our revenue base through further expansion into targeted end markets with higher growth and margin profiles, including emerging markets," company president and CEO John Lundgren said in a statement.
HHI manufactures residential door locks, hardware and plumbing fixtures under the Kwikset, Weiser, Baldwin, Stanley, National, and Pfister brands. Ninety percent of the segment's revenue comes from North America and more than one-half of its revenues from home centers in the U.S.