Black & Decker shareholders approve merger with Stanley Works

Posted: 10:34 am Fri, March 12, 2010
By Staff and Wire Reports

Black & Decker shareholders overwhelmingly approved Friday the power tool company’s $3.5 billion sale to Stanley Works.

The shareholder vote is the final step in Black & Decker’s transformation from a corporate cornerstone in Greater Baltimore to now becoming a piece of another Fortune 500 company, Connecticut-based Stanley Works, a hardware and home improvement manufacturer.

The new company will open for business Monday with the name Stanley Black & Decker. It will be headquartered in New Britain, Conn.

Of the 49.6 million votes cast, 99 percent were in favor of the merger, according to reports.

The deal was announced last November.

It came under regulatory scrutiny this week after Black & Decker revealed a business relationship between CEO Nolan D. Archibald and M. Anthony Burns, a board member.

Company executives and industry analysts have described the merger as a marriage of complementary businesses. Black & Decker is known for its tool lines like DeWalt, Kwikset, Baldwin and Price Pfister, while Stanley’s brands include FatMax, Bostitch, Best and Vidmar.

The combined company will become the nation’s largest toolmaker, according to regulatory filings submitted to the Securities and Exchange Commission.

The company’s power tool division will remain headquartered in Towson, where Black & Decker operates.

Under the agreement, Black & Decker shareholders received stock valued at $57.57 for each share. Based on the company’s 60.2 million shares outstanding July 24, the deal is worth $3.46 billion.

Stanley shareholders will own about 50.5 percent of the combined company, while Black & Decker shareholders will hold the rest.

Black & Decker has 22,100 workers while Stanley Works has 18,200. The companies hope their combination will produce at least $350 million in cost savings within three years, in part through an unspecified number of job cuts, and increase earnings per share by $1 within three years.

Earlier Friday, European regulators approved the deal and the Stanley Works’ board of directors approved six board members of Black & Decker to join the new company’s board. Black & Decker’s current CEO Nolan D. Archibald will become chairman of the board after the acquisition.

Black & Decker shares fell 24 cents to 74.70 in midday trading while Stanley Works shares dipped 20 cents to $58.63.