공시 • Jun 21
ASSA ABLOY AB (publ) (OM:ASSA B) completed the acquisition of Hardware and Home Improvement Business of Spectrum Brands Holdings, Inc. (NYSE:SPB).
ASSA ABLOY AB (publ) (OM:ASSA B) entered into a definitive agreement to acquire Hardware and Home Improvement Business of Spectrum Brands Holdings, Inc. (NYSE:SPB) for $4.3 billion on September 8, 2021. Spectrum Brands will pay for an aggregate purchase price of $4.3 billion in cash (the " Purchase Price "), on a cash and debt free basis, subject to customary purchase price adjustments. The transaction will be fully funded by existing cash and new debt. HHI will become part of the Opening Solutions Americas Division. ASSA ABLOY has agreed to pay a termination fee of $350 million in certain circumstances if the transaction agreement would be terminated and required regulatory approvals would not have been obtained. For the last twelve month ended July 4, 2021, HHI's net sales were $1.7 billion, Net Income was $305.5 million and EBITDA was $339.8 million. HHI is headquartered in Lake Forest, California with some 7,500 employees worldwide and has manufacturing facilities in the United States, Mexico, Taiwan, China, and the Philippines.
The transaction is subject to receipt of certain regulatory approvals, the expiration or termination of required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and customary closing conditions. The consummation of the acquisition is not subject to any financing condition. Upon closing of the transaction, Spectrum Brands expects to receive approximately $3.5 billion in net proceeds, subject to final tax calculations and purchase price adjustments. Spectrum Brands expects to use the proceeds from this transaction to repay debt and reduce its gross leverage ratio to approximately 2.5x times in the near term. Excess proceeds are expected to be allocated to invest for organic growth, fund complementary acquisitions and return capital to shareholders. As of September 15, 2022, Spectrum Brands will vigorously oppose the U.S. Department of Justice’s (“DOJ”) baseless attempt to block the Company’s sale of its Hardware and Home Improvement. The transaction is expected to close during the fourth quarter of 2021. As on December 2, 2021, the transaction is expected to close during 2022. The operating margin effect for ASSA ABLOY is initially expected to be dilutive. The acquisition will be accretive to EPS from the start. On December 2, 2021, it was communicated that the acquisition of HHI is expected to close during 2022. The US regulator continues to review the proposed acquisition of HHI and ASSA ABLOY is working to resolve its potential concerns. ASSA ABLOY and Spectrum Brands have agreed to extend their agreement for ASSA ABLOY to acquire the HHI division of Spectrum Brands to June 30, 2023. As of October 17, 2022, ASSA ABLOY formally filed its response to the U.S. Department of Justice´s ("DOJ") complaint to block the proposed acquisition of the Hardware and Home Improvement division ("HHI") of Spectrum Brands. On December 2, 2022, ASSA ABLOY announced an agreement to sell its Emtek and the Smart Residential Business in the U.S. and Canada to Fortune Brands, a strong and experienced player in the home hardware and security markets. As of May 6, 2023, Spectrum Brands agreed to a stipulation with DOJ to settle the DOJ’s challenge of ASSA ABLOY’s acquisition of Hardware and Home Improvement segment, Under the terms of the proposed settlement, which is subject to court approval, ASSA ABLOY must divest assets to Fortune Brands Innovations, Inc which includes assets like ASSA ABLOY'sEMTEK and Schaub premium mechanical door hardware businesses, its Yale and August residential smart lock businesses in the United States and Canada, and other assets for multifamily smart lock applications . Approval of the Mexican competition authority is the only outstanding regulatory approval. As of June 5, 2023, the transaction has been approved by the Mexican competition authority. The approval from the Mexican competition authority was the last regulatory approval required to complete this transaction. The closing of this transaction is subject to satisfaction of customary closing conditions. Spectrum Brands continues to expect to close this transaction on or prior to June 30, 2023.
Credit Suisse Securities and RBC Capital Markets acted as joint financial advisors to Spectrum Brands. Brian Wolfe and Cheryl Chan, David H. Schnabel, Stephen I. Brecher, Howard Shelanski and Pritesh P. Shah of Davis Polk & Wardwell LLP acted as legal counsel for Spectrum Brands. BofA Securities acted as exclusive financial advisor and Linklaters LLP and Hogan Lovells acted as legal advisors to ASSA ABLOY. The Linklaters team was led by Peter Cohen-Millstein, Megan Ridley-Kaye and Fredrik Lindqvist. Darcy Down, Alan Zoccolillo, Nina Nola and Federico Cuadra del Carmen of Baker & McKenzie LLP acted as legal advisor to Spectrum brands.
ASSA ABLOY AB (publ) (OM:ASSA B) completed the acquisition of Hardware and Home Improvement Business of Spectrum Brands Holdings, Inc. (NYSE:SPB) on June 20, 2023.