Stanley Black & Decker Extends Outdoor Portfolio with MTD Buy
Stanley Black & Decker will acquire a 20% stake in MTD Products for $234 million in cash. Under the agreement, Stanley Black & Decker will have an option to acquire the rest of the company in 2021.
The partnership will enhance the companies’ existing commercial relationship, which includes the manufacture of outdoor products under the Craftsman brand. Going forward, the companies together will pursue revenue and cost opportunities, improve operational efficiencies and introduce new products for professional and residential outdoor equipment consumers.
"This investment in MTD increases our presence in the $20 billion global lawn and garden market in a financially and operationally prudent way,” said James Loree, chief executive officer of Stanley Black & Decker. “We have always viewed outdoor products as an attractive growth category for us to expand our presence beyond handheld electric products."
With 2017 revenues exceeding $2 billion, MTD manufactures and distributes outdoor power equipment under brands such as Cub Cadet, Troy-Bilt, Remington, Bolens, Rover, Robomow and Wolf-Garten. Headquartered in Valley City, Ohio, the company has manufacturing facilities in North America, Europe and Asia, and a global distribution network.
"MTD and Stanley Black & Decker are both proven leaders in our respective industries with iconic brands and world class capabilities," said MTD CEO Robert Moll. "We're both passionate about innovation, with complementary businesses. Ultimately, this will give us more resources to bring really exciting products to our consumers."
With the acquisition, Stanley Black & Decker will appoint two representatives to MTD's board of directors. Should Stanley choose to acquire the remaining 80%, the companies have agreed to a valuation multiple based on MTD's expected 2018 EBITDA.