Back to top

Analyst Blog

Stanley Black & Decker (SWK - Analyst Report) recently received antitrust clearance from the European Commission for its acquisition of Sweden-based Niscayah.

In the month of June, Stanley proposed to acquire Niscayah for SEK7.6 billion or approximately $1.2 billion, through a tender offer by a wholly-owned subsidiary SBD Holding AB. The transaction is expected to close in September 2011.

Niscayah’s board has advised the shareholders and warrant holders to accept the deal. Further, shareholders of Niscayah owning a 19.5% stake have given their consent to the proposal.

The company currently has 72 million shares or a 19.8% stake in the target company. The offer price of SEK18 per share represents a 15% premium over Niscayah's closing price on June 23, 2011.

Niscayah is a leading commercial security and monitoring company specializing in electronic security services and solutions, with a strong presence in Europe including the Nordic Region, as well as in the United States. Estimated revenue from Niscayah for fiscal 2011 is approximately $1 billion.

The acquisition would enhance Stanley’s existing security product offerings and expand its international footprint.

As a consequence of the merger, management expects annual cost savings of $80 million, and more than half will be realized in the first year after closing. The acquisition will also be accretive to EPS by 20 cents in year one and 45 cents by year three.

Stanley Black & Decker manufactures tools and engineered security solutions across the globe. Prime competitors of the company are Danaher Corp. (DHR - Analyst Report), Makita Corp. , and Snap-on Inc. (SNA - Analyst Report).