http://finance.yahoo.com/news/Stanle...&asset=&ccode=



CHICAGO (AP) -- The tool maker Stanley Works is buying rival Black & Decker Corp. for $4.5 billion, the two companies said Monday, uniting two of their industry's most iconic brands.

The deal would create the largest U.S. toolmaker, Morningstar analyst Anthony Dayrit said.

Stanley shareholders will own about 50.5 percent of the combined company, which will be called Stanley Black & Decker. Black & Decker shareholders will hold a 49.5 percent stake after the all-stock deal is complete.

"This is a unique opportunity to bring together two great companies, each with first-rate brands, and provide enhanced opportunities to generate superior returns as we build on this new, larger platform," Stanley Chairman John F. Lundgren, who will be president and CEO, said in a statement.

Black & Decker shareholders are to receive about 1.28 shares of Stanley Works for each share they own. The nine members of Stanley Works' board will remain in place and be joined by six new members from Black & Decker's current board.

The deal will cut costs by $350 million within three years, likely in part through job cuts, and grow earnings per share by $1 within three years, the companies said.

Executives said most of the savings will come from reducing corporate overhead and consolidating business units and manufacturing, distribution and purchasing.

James C. Lucas, managing director of Janney Montgomery Scott LLC, said there is little overlap in the two companies' products -- with Stanley being a leader in consumer and industrial hand tools and security, and Black & Decker in power tools.

Lucas said it was too soon to speculate about how the deal will affect jobs, but the two companies have different processes and therefore different plants.

Black & Decker, based in Towson, Md., has 22,100 workers. Stanley Works, based in New Britain, Conn., has 18,200 workers. The combined company's corporate headquarters will remain in Connecticut while its power tool division will remain headquartered in Maryland.

Stanley Works' brands include its Stanley tools line and FatMax, Bostitch and Mac Tools, which are used on cars. In addition to its namesake line, Black & Decker owns DeWalt, Porter-Cable, Kwikset and Baldwin brands, which are popular with both consumers and professionals.

Dayrit said space remains for smaller tool makers that make up most of the industry.

"There's a lot of smaller players who make cheaper tools," he said. "I think these guys will still be competitive because you have consumers that won't be willing to pay up for the quality of a Black & Decker tool."

Each company's board of directors has signed off on the deal, but it still must win regulatory and shareholder approval. It's expected to close in the first half of 2010.

Black & Decker shares climbed $10.12, or 21.4 percent, $57.45 in after-hours trading after closing at $47.34 earlier in the day.

Stanley Works shares rose $1.77, or 3.9 percent, to $46.96 in after-hours trading. Shares of the company closed at $45.15 in regular trading.

Associated Press Writer Kasey Jones contributed reporting from Baltimore, Md.

Do you have permission to post that copyrighted material?

- Leigh

It's OK it's a Chinese knock off.

No. But please don't send deputy dawg over to arrest me.

You're opening yourself and the site to potential prosecution.

Publishers are getting really nasty about copyright infringement.

- Leigh

Wish you could have posted that 3 days ago

"There's a lot of smaller players who make cheaper tools," he said. "I think these guys will still be competitive because you have consumers that won't be willing to pay up for the quality of a Black & Decker tool."

Hell, even I can affor a B&D tool. I simply won't pay double for a B&D in a different color, Dewalt, at twice the price. That they are made in the same factories that make HF tools doesn't help.

"Executives said most of the savings will come from reducing corporate overhead and consolidating business units and manufacturing, distribution and purchasing."

I would bet that more hourly are let go to get that savings than corporate people. They are keeping both HQs so will have about the same headcount in the upstairs offices.

How many actual companies are there, now? Ryobi owns Milwaukee and Ridgid, and probably a few more. Then there's Bosch, German, and the other Japanese companies. Skil probably has been bought up, too.We are down to buying by color of the housing, because there are only a couple makers in the country.

Oh, well.

Cheers,

George

I just bought a Stanley twelve foot PowerLock tape measure at Home Depot.I flip the package over and it says,made in Thailand.I hope they are using a U.S.twelve foot standard.

Why is this interesting ? Two fine old USA companies that for a decade or more, have morphed into basically purveyors of Chinese tools sold at Kmart and Chinamart for the home consumer join forces...so what ?

You may be surprised to know how much of the DeWalt stuff is born in USA.

Exactly. Intention was nothing more than cynical. Both peddle mostly garbage except for some of the professional grade DeWalt, Mac, etc.... The author called the two brands "iconic".... that in of itself is laughable.

Ditto what Milacron said.

Bosch owns Skil and has for quite a few years now.

Exactly as Mil says. They are all selling "China" tools under their own "Proud to be USA made" and we lament that they now merge, to make their purchasing power greater with their Chinese providers.

I bought a new pocket knife the other day. Buck was on sale, 3 blade, SS, asked to look at it, flipped it over, "Made in China". Gave it back. Copy of the Schrade 303. Said I would look for a Schrade. "Oh, we have that. Right here." Same price. Damn. That, TOO, is made in China. AND owned by Buck. Bought it to replace a 20 year old "Old Timer", because the blade DOES stain a bit, being carbon steel.

They are identical, other than my old one is a bit worn from whetting over 20 years.

I would actually rather buy a knife sold by Zong Zhin, Chinese company, than one sold as Buck, whose company is a CEO and minions who eat up the profits, with no more employees other than warehouse men. I have said the same about Panasonic and other electronics makers who rebrand to GE or RCA or any other USA brand.

That CEO and Board make profit from the sweat of the warehouseman, not a maker of parts in the whole corporation.

We cannot exist as vendors of imports.

Cheers,

George

The statement looks like it was created using a plugin for Catbert's Mission Statement Generator. People like this are not to be trusted.

Blame Wall Street.

Both companies have maxed out profits by going to China, now all they can do is merge. You see it all the time in corporate America.

It's not enough to make steady, good profits. Wall Street demands profits that are always INCREASING.

Other than DeWalt what brand under parent company B&D is decent quality because B&D sure as heck isn't.

My B-In-law bought a B&D jigsaw a few years ago and it couldn't even get the first cut straight , which is not too much to as even for a cheap tool. Surprisingly this saw was made in England. My first Jigsaw was also a B&D that I bought in London back in 1990.

Milwaukee and Hilti both make tools in China now. Milwaukee I think is owned by some Hong Kong company.

If DeWalt is the only worthy brand in the B&D house, why would anyone pay $4.5 billion for B&D since some of that money is undoubtedly being wasted on the worthless B&D name.

Absolutely,
So the only way to continue to make profit and get return on all those $, is to now start cutting costs.
So it's bad news again for the workforce, but good news for the shareholders...

When I was looking at power tools this time last year some of Milwaukee's stuff was still made in USA. Not all, and I have no idea what % is domestic.

Threads on this topic from about 1 yr ago:

OT: Any Battery or Cordless Power Tools Still Made in USA? (from 10/17/2008)

*sigh* Trying to buy a drill made in the USA (from 11/26/2008)

There are 30 turning centers just on the other side of my office wall turning out parts for B&D as I type this, right here in Nort Philly. Not all of their parts are made in China.
Greg F

So, what's the answer? I'm ready to be surprised.