Stanley Black & Decker To Sell Security Unit For $3.2 Bln; Plans $4 Bln Buyback; Backs FY21 View

Diversified industrial company Stanley Black & Decker (SWK) announced Wednesday that it has signed a definitive agreement for the sale of most of its Security assets to Securitas AB for $3.2 billion in cash. The sale is expected to sharpen the company's strategic focus on its core businesses.

Further, the company reaffirmed its full-year 2021 earnings per share of $9.70 - $10.05 on a GAAP basis and $10.70 - $10.90 on an adjusted basis.

On average, 11 analysts polled by Thomson Reuters expect earnings of $10.95 per share for the year. Analysts' estimates typically exclude special items.

The proposed sale includes Stanley Black & Decker's Commercial Electronic and Healthcare Security business lines. The businesses carry 2021 forecasted revenues of approximately $1.7 billion with an adjusted EBITDA margin in the low double-digits.

The transaction has been approved by the Boards of Directors of Stanley Black & Decker and Securitas, an intelligent security solutions partner. The deal is expected to close in the first half of 2022, subject to regulatory approvals and other customary closing conditions.

The company said the net proceeds from the sale would be used to fund, in part, an approximately $4 billion share repurchase which is planned to be completed in 2022.

The transaction excludes Stanley Access Technologies, which provides state-of-the-art automatic door solutions.

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