It’s been a busy few months for Stanley Black & Decker.
Following its $1.95 billion purchase of Newell Brand Inc.’s tool business in October, the Connecticut-based manufacturer announced Thursday it had reached an agreement to purchase Craftsman from Sears for $900 million.
The deal, however, could exceed $1 billion. Stanley said it will pay $525 million when the deal closes, and another $250 million after three years. Stanley also will pay Sears a percentage of its Craftsman sales for the next 15 years, during which Sears will be able to continue selling Craftsman products royalty-free.
If consumers still had a good reason to go into a Sears, that opportunity might be dwindling, as Sears also announced that it will be closing 108 Kmart and 42 Sears stores, according to the Wall Street Journal. Included in the closings is the original Kmart location in Garden City, Mich., which opened in 1962.
While the deal appears to be bad news for Sears, Stanley Black & Decker’s chief executive said it’s a good thing for American manufacturing.
“To accommodate the future growth of Craftsman, we intend to expand our manufacturing footprint in the U.S.,” Stanley CEO James M. Loree said in a statement. “This will add jobs in the U.S., where we have increased our manufacturing headcount by 40 percent in the past three years.”
The deal is expected to be finalized by the end of the year.
Thumbnail photo via Flickr/TedMurphy