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Stanley Black & Decker $SWK to Acquire @Craftsman Tools from Sears $SHLD for $900M

Stanley Black & Decker $SWK to Acquire @Craftsman Tools from Sears $SHLD for $900M

Sears Holdings initiated a formal process to explore strategic alternatives for its Kenmore, Craftsman and DieHard brands, and its Sears Home Services, with the assistance of Citigroup Global Markets and LionTree Advisors, as reported last year by ExitHub. The deal provides Stanley Black & Decker with the rights to develop, manufacture and sell Craftsman-branded products in non-Sears Holdings retail, industrial and online sales channels across the U.S. and in other countries. As part of the agreement, Sears Holdings will continue to offer Craftsman-branded products, sourced from existing suppliers, through its current retail channels via a perpetual license from Stanley Black & Decker, which will be royalty-free for the first 15 years after closing, then 3% thereafter. Today only approximately 10% of Craftsman-branded products are sold outside of Sears Holdings and the agreement will enable Stanley Black & Decker to significantly increase Craftsman sales in these untapped channels. “Craftsman is a legendary, American brand with tremendous consumer awareness built on a legacy of producing quality products at a great value,” said Stanley Black & Decker President and CEO James M. Loree. “This agreement represents a significant opportunity to grow the market by increasing the availability of Craftsman products to consumers in previously underpenetrated channels. We intend to invest in the brand and rapidly increase sales through these new channels, including retail, industrial, mobile and online. To accommodate the future growth of Craftsman, we intend to expand our manufacturing footprint in the U.S. This will add jobs in the U.S., where we have increased our manufacturing headcount by 40% in the past three years. Sears Holdings’ Chairman and Chief Executive Officer Edward S. Lampert stated, “We are pleased to reach this agreement, after determining that externalizing the Craftsman brand would accomplish our goals of driving value for Sears Holdings and positioning Craftsman for future growth. This transaction represents a significant step in our ongoing transformation to a membership focused business model.” Lampert, who is also the founder, chairman and CEO of ESL Investments, his hedge fund based in Greenwich, Connecticut, engineered today’s Sears Holdings by merging Kmart and Sears Roebuck in 2005. Existing sales of Craftsman products outside the Sears Holdings and Sears Hometown distribution channels, which will be assumed immediately upon closing by Stanley Black & Decker, were approximately $200 million over the last 12 months. The sale of Craftsman branded products is expected to contribute approximately $100 million of average annual revenue growth for approximately the next ten years. The transaction is expected to be accretive to earnings by approximately $0.10-$0.15 per share in year one, increasing to approximately $0.35-$0.45 by year five and to approximately $0.70-$0.80 by year ten, excluding approximately $20 million of deal-related costs. The deal, which was approved by the Boards of Directors of both companies, is expected to close during 2017, subject to customary closing conditions and regulatory approvals. Stanley Black & Decker, an S&P 500 company, is a diversified global provider of hand tools, power tools and related accessories, mechanical access solutions and electronic security solutions, healthcare solutions, engineered fastening systems, and more. Sears Holdings is a leading integrated retailer focused on seamlessly connecting the digital and physical shopping experiences. Sears Holdings is home to Shop Your Way, a social shopping platform offering members rewards for shopping at Sears and Kmart as well as with other retail partners. The company operates through its subsidiaries, including Sears, Roebuck and Co., founded in 1886, and Kmart Corp., founded in 1899, with full-line and specialty retail stores across the United States. Photo: Edward S. Lampert, Chairman and CEO, Sears Holdings Corp, and ESL Investments.]]>

Centerview's Conyers Park $CPAAU Near $1.5B Buyout of @FerraraCandy from @L_Catterton

Centerview's Conyers Park $CPAAU Near $1.5B Buyout of @FerraraCandy from @L_Catterton

L Catterton started exploring an exit for Ferrara Candy Co., which has 16 brands and annual revenue of $1.1 billion, as reported by ExitHub in July, and was said to have hired Rothschild & Co. and Morgan Stanley to explore options for Ferrara, including a sale or IPO at a $1 billion valuation. Conyers Park’s interest in acquiring Ferrara in a deal valued roughly at $1.5 billion was earlier reported by the New York Post. The move would seem to emulate Gores Holdings Inc. (NASDAQ CM: GRSHU, GRSH, GRSHW), a blank check company sponsored by Beverly Hills-based private equity firm Gores Group LLC, which agreed to acquire Hostess Brands from private equity firm Apollo Global Management LLC (NYSE: APO) and Metropoulos and Co., in a reverse merger deal valued at $2.3 billion or 10.4x EBITDA. The Gores-Hostess deal was announced in July, two weeks before Conyers Park’s IPO. Ferrara, based in Oakbrook Terrace, Illinois, makes yummy gummies, better-for-you fruit snacks and other confectionary delectables. The platform was formed through the combination of Farley’s & Sathers and Ferrara Pan Candy Co. in 2012, and includes iconic brands such as Trolli, Lemonheads, Now & Later, Atomic Fireball and Brach’s. Many of these brands have endured and prospered for the better part of a hundred years, since Ferrara Pan Candy Co. was founded by Salvatore Ferrara in 1908 as a manufacturer of Italian pastries and sugar coated candy almonds from his bakery in Chicago’s Little Italy neighborhood. “As America’s number one maker of non-chocolate confections, we’ve been delivering little bites of goodness for more than a century. And we’re only getting started,” says Ferrara Candy Co. “Sure we’ve got a sweet history — but we’ve got an even richer opportunity for future growth and success.” L Catterton, formed in January 2016 through the partnership of Catterton, LVMH and Groupe Arnault, is the largest consumer-focused private equity firm in the world, operating multiple funds out of seventeen offices across five continents. Since its founding in 1989, Catterton has leveraged its category insight, strategic and operating skills, and network of industry contacts to establish one of the strongest private equity investment track records in the middle market. L Catterton builds on this heritage and the strong track record of LVMH and Groupe Arnault’s existing European and Asian private equity and real estate operations, conducted under the L Capital and L Real Estate franchises. L Catterton invests in all major consumer segments, including: Food and Beverage, Retail and Restaurants, Beauty and Wellness, Fashion and Accessories, Consumer Products and Services, Consumer Health, and Media and Marketing Services, as well as real estate projects anchored by luxury retail. L Catterton’s investments include: Peloton, Restoration Hardware, CorePower Yoga, Sweaty Betty, Outback Steakhouse, Plum Organics, CHOPT Creative Salad Company, Mendocino Farms, Noodles & Company, PIADA, Hopdoddy, Vroom, Snap Kitchen, Frederic Fekkai, PIRCH, Build-A-Bear Workshop, Wellness pet food, Nature’s Variety pet food, Kettle Foods, Odwalla, P.F. Chang’s, Ba&sh, Sandro and Maje, CellularLine, Vicini / Zanotti, Cigierre, Gant, Nutrition and Sante, Pepe Jeans & Hackett, 2XU, Charles & Keith, Marubi, Bateel, Sasseur, Emperor Watch and Jewelry, Miami Design District and G6 in Ginza – Tokyo, to name a few.]]>