Stanley Black & Decker announced today it is selling off its attachments and hydraulic tools business to Epiroc AB. The sale agreement is for $760 million cash.
According to the company:
Donald Allan, Jr., Stanley Black & Decker's president and CEO, stated, "The sale of Infrastructure demonstrates our commitment to maximizing shareholder value through active portfolio management. Simplification is a core tenet of our strategic transformation, and this transaction will help further sharpen our focus on value creation opportunities in our core businesses, while supporting our capital allocation priorities. I am confident that Infrastructure is positioned for a future of innovation and growth with Epiroc and would like to thank all our team members for their valuable contributions over the years."
Infrastructure is expected to generate $450 million to $470 million in revenue with a mid-to-high teens adjusted EBITDA margin in fiscal year 2023. Stanley Black & Decker expects to use the cash proceeds of the transaction, net of modest taxes, to reduce debt.
Stanley Black & Decker expects to incur a pre-tax, non-cash charge of $100 million to $150 million related to the write-down of the Infrastructure net assets, which will be excluded from adjusted earnings. Until the transaction closes, the results of Infrastructure will remain in continuing operations and will not be reclassified as discontinued operations. The completion of the Infrastructure transaction is subject to regulatory approval and other customary closing conditions.
