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Stanley Black and Decker to Buy 20% Stake in Outdoor Power Equipment Maker MTD Products for USD 234m
Thursday 13 September 2018

13 September 2018 - US-based tool and hardware maker Stanley Black and Decker (NYSE: SWK) has entered into a definitive agreement to acquire a 20% stake in outdoor power equipment manufacturer MTD Products Inc for USD 234m in cash, the company said.

Under the terms of the agreement, Stanley Black and Decker has the option to acquire the remaining 80% of MTD beginning on 1 July 2021.

With 2017 revenues in excess of USD 2bn, MTD manufactures and distributes lawn tractors, zero turn mowers, walk behind mowers, snow throwers, trimmers, chain saws, utility vehicles and other outdoor power equipment for both residential and professional lawn and garden customers.

Founded over 85 years ago and headquartered in Valley City, Ohio, MTD's brands include Cub Cadet, Troy-Bilt, and Remington, among others. MTD has manufacturing facilities in North America, Europe and Asia, and a global distribution network.

This partnership significantly enhances Stanley Black and Decker and MTD's existing commercial relationship, which currently includes the manufacture of select outdoor products under the Craftsman brand. 

Going forward, the two companies will work together to pursue revenue and cost opportunities, improve operational efficiency and introduce new and innovative products for professional and residential outdoor equipment customers, leveraging their respective portfolios of strong brands.

The transaction, which is expected to close in early 2019, is subject to regulatory approvals and customary closing conditions. 

In connection with the transaction, Stanley Black and Decker will appoint two representatives to MTD's 11-member board of directors.

Beginning in 2021, should Stanley Black and Decker choose to exercise its right to acquire the remaining 80% stake, the companies have agreed to a valuation multiple based on MTD's expected 2018 EBITDA, with a sharing arrangement for any future EBITDA growth.

Stanley Black and Decker is a global provider of hand tools, power tools and related accessories, electronic security solutions, healthcare solutions, engineered fastening systems, and other products.
Details
Date Published: 13/09/2018
Target: MTD Products
Country: USA
Deal Size: 234m (USD)
Sector: Machinery/Engineering
Type: Corporate acquisition
Financing: Cash
Status: Agreed
Vendor:
Buyer: Stanley Black and Decker,  
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