Tool company merger: Stanley and Black & Decker combine

November 3, 2009

(ChattahBox) — Stanley Works and Black & Decker Corp., two of the most recognizable names in home improvement, agreed to a $4.5 billion all-stock deal. Stanley who is the smaller company, based on sales and employees, but will be the acquirer in the deal, is issuing 1.275 of its shares for every Black & Decker share, a 22 percent premium based on Monday’s share prices. The two iconic US hand-tool and power-tool makers, which will be called Stanley Black & Decker, combine to create a powerhouse with $8.4 billion in sales. A spokesman on Monday said there is little overlap in manufacturing jobs between the two companies.  However Stanley Chief Executive John F. Lundgren who is being named chief executive of the combined company, acknowledged the merger would likely mean thousands of job cuts, especially in the corporate staffs and areas like purchasing and warehouses that serve the same region. He said he hoped the job cuts would total few than 4,000. The transaction, which had been discussed three times before, according to the companies, must still be approved by shareholders of both companies and federal regulators. The merger is expected to be completed by mid 2010.

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