Attached files
| file | filename |
|---|---|
| 8-K - CURRENT REPORT - STANLEY BLACK & DECKER, INC. | form8-k.htm |
Exhibit
99.1
A
POWERFUL LEGACY, A FUTURE OF GROWTH
November 3,
2009
2
Forward
Looking Statements
CAUTIONARY
STATEMENTS
Under
the Private Securities Litigation Reform Act of 1995
Statements in this
presentation that are not historical, including but not limited to those
regarding the consummation of the proposed transaction between Stanley and Black
& Decker and the realization of synergies in
connection therewith, are “forward looking statements” and, as such, are subject to risk and uncertainty.
connection therewith, are “forward looking statements” and, as such, are subject to risk and uncertainty.
Stanley’s and Black
& Decker’s ability to deliver the results as described in this presentation
is based on current expectations and involves inherent risks and uncertainties,
including factors listed below and other factors
that could delay, divert, or change any of them, and could cause actual outcomes and results to differ materially from current expectations. In addition to the risks, uncertainties and other factors discussed in this
presentation, the risks, uncertainties and other factors that could cause or contribute to actual results differing materially from those expressed or implied in the forward looking statements include, without limitation, those
set forth in the “Risk Factors” section, the “Legal Proceedings” section, the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and other sections of Stanley’s and Black &
Decker’s Annual Reports on Form 10-K and any material changes thereto set forth in any subsequent Quarterly Reports on Form 10-Q, those contained in Stanley’s and Black & Decker’s other filings with the Securities
and Exchange Commission, and those set forth below.
that could delay, divert, or change any of them, and could cause actual outcomes and results to differ materially from current expectations. In addition to the risks, uncertainties and other factors discussed in this
presentation, the risks, uncertainties and other factors that could cause or contribute to actual results differing materially from those expressed or implied in the forward looking statements include, without limitation, those
set forth in the “Risk Factors” section, the “Legal Proceedings” section, the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and other sections of Stanley’s and Black &
Decker’s Annual Reports on Form 10-K and any material changes thereto set forth in any subsequent Quarterly Reports on Form 10-Q, those contained in Stanley’s and Black & Decker’s other filings with the Securities
and Exchange Commission, and those set forth below.
These
factors include but are not limited to the risk that regulatory and stockholder
approvals of the transaction are not obtained on the proposed terms and
schedule; the future business operations of Stanley or Black &
Decker will not be successful; the risk that the proposed transaction between Stanley and Black & Decker will not be consummated; the risk that Stanley and Black & Decker will not realize any or all of the anticipated
benefits from the transaction; the risk that cost synergy, customer retention and revenue expansion goals for the transaction will not be met and that disruptions from the transaction will harm relationships with customers,
employees and suppliers; the risk that unexpected costs will be incurred; the outcome of litigation (including with respect to the transaction) and regulatory proceedings to which Stanley or Black & Decker may be a party;
pricing pressure and other changes within competitive markets; the continued consolidation of customers particularly in consumer channels; inventory management pressures on Stanley’s and Black & Decker’s
customers; the impact the tightened credit markets may have on Stanley or Black & Decker or customers or suppliers; the extent to which Stanley or Black & Decker has to write off accounts receivable or assets or
experiences supply chain disruptions in connection with bankruptcy filings by customers or suppliers; increasing competition; changes in laws, regulations and policies that affect Stanley or Black & Decker, including, but
not limited to trade, monetary, tax and fiscal policies and laws; the timing and extent of any inflation or deflation in 2009 and beyond; currency exchange fluctuations; the impact of dollar/foreign currency exchange and
interest rates on the competitiveness of products and Stanley’s and Black & Decker’s debt programs; the strength of the U.S. and European economies; the extent to which world-wide markets associated with
homebuilding and remodeling continue to deteriorate; the impact of events that cause or may cause disruption in Stanley’s or Black & Decker’s manufacturing, distribution and sales networks such as war, terrorist
activities, and political unrest; and recessionary or expansive trends in the economies of the world in which Stanley or Black & Decker operates, including but not limited to the extent and duration of the current recession
in the US economy.
Decker will not be successful; the risk that the proposed transaction between Stanley and Black & Decker will not be consummated; the risk that Stanley and Black & Decker will not realize any or all of the anticipated
benefits from the transaction; the risk that cost synergy, customer retention and revenue expansion goals for the transaction will not be met and that disruptions from the transaction will harm relationships with customers,
employees and suppliers; the risk that unexpected costs will be incurred; the outcome of litigation (including with respect to the transaction) and regulatory proceedings to which Stanley or Black & Decker may be a party;
pricing pressure and other changes within competitive markets; the continued consolidation of customers particularly in consumer channels; inventory management pressures on Stanley’s and Black & Decker’s
customers; the impact the tightened credit markets may have on Stanley or Black & Decker or customers or suppliers; the extent to which Stanley or Black & Decker has to write off accounts receivable or assets or
experiences supply chain disruptions in connection with bankruptcy filings by customers or suppliers; increasing competition; changes in laws, regulations and policies that affect Stanley or Black & Decker, including, but
not limited to trade, monetary, tax and fiscal policies and laws; the timing and extent of any inflation or deflation in 2009 and beyond; currency exchange fluctuations; the impact of dollar/foreign currency exchange and
interest rates on the competitiveness of products and Stanley’s and Black & Decker’s debt programs; the strength of the U.S. and European economies; the extent to which world-wide markets associated with
homebuilding and remodeling continue to deteriorate; the impact of events that cause or may cause disruption in Stanley’s or Black & Decker’s manufacturing, distribution and sales networks such as war, terrorist
activities, and political unrest; and recessionary or expansive trends in the economies of the world in which Stanley or Black & Decker operates, including but not limited to the extent and duration of the current recession
in the US economy.
Neither
Stanley nor Black & Decker undertake any obligation to publicly update or
revise any forward-looking statements to reflect events or circumstances that
may arise after the date hereof.
Additional
Information
The
proposed transaction involving Stanley and Black & Decker will be submitted
to the respective stockholders of Stanley and Black & Decker for their
consideration. In
connection with the proposed transaction,
Stanley will file with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 that will include a joint proxy statement of Stanley and Black & Decker that will also constitute a prospectus
of Stanley. Investors and security holders are urged to read the joint proxy statement/prospectus and any other relevant documents filed with the SEC when they become available, because they will
contain important information. Investors and security holders may obtain a free copy of the joint proxy statement/prospectus and other documents (when available) that Stanley and Black & Decker file with the SEC at
the SEC’s website at www.sec.gov and Stanley’s website related to the transaction at www.stanleyblackanddecker.com. In addition, these documents may be obtained from Stanley or Black & Decker free of charge by
directing a request to Investor Relations, The Stanley Works, 1000 Stanley Drive, New Britain, CT 06053, or to Investor Relations, The Black & Decker Corporation, 701 E. Joppa Road, Towson, Maryland 21286,
respectively. Stanley, Black & Decker and certain of their respective directors and executive officers may be deemed to be participants in the proposed transaction under the rules of the SEC. Investors and security
holders may obtain information regarding the names, affiliations and interests of Stanley’s directors and executive officers in Stanley’s Annual Report on Form 10-K for the year ended January 3, 2009, which was filed
with the SEC on February 26, 2009, and its proxy statement for its 2009 Annual Meeting, which was filed with the SEC on March 20, 2009. Investors and security holders may obtain information regarding the names,
affiliations and interests of Black & Decker’s directors and executive officers in Black & Decker’s Annual Report on Form 10-K for the year ended December 31, 2008, which was filed with the SEC on February 17, 2009,
and its proxy statement for its 2009 Annual Meeting, which was filed with the SEC on March 16, 2009. These documents can be obtained free of charge from the sources listed above. Additional information regarding
the interests of these individuals will also be included in the joint proxy statement/prospectus regarding the proposed transaction when it becomes available.
Stanley will file with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 that will include a joint proxy statement of Stanley and Black & Decker that will also constitute a prospectus
of Stanley. Investors and security holders are urged to read the joint proxy statement/prospectus and any other relevant documents filed with the SEC when they become available, because they will
contain important information. Investors and security holders may obtain a free copy of the joint proxy statement/prospectus and other documents (when available) that Stanley and Black & Decker file with the SEC at
the SEC’s website at www.sec.gov and Stanley’s website related to the transaction at www.stanleyblackanddecker.com. In addition, these documents may be obtained from Stanley or Black & Decker free of charge by
directing a request to Investor Relations, The Stanley Works, 1000 Stanley Drive, New Britain, CT 06053, or to Investor Relations, The Black & Decker Corporation, 701 E. Joppa Road, Towson, Maryland 21286,
respectively. Stanley, Black & Decker and certain of their respective directors and executive officers may be deemed to be participants in the proposed transaction under the rules of the SEC. Investors and security
holders may obtain information regarding the names, affiliations and interests of Stanley’s directors and executive officers in Stanley’s Annual Report on Form 10-K for the year ended January 3, 2009, which was filed
with the SEC on February 26, 2009, and its proxy statement for its 2009 Annual Meeting, which was filed with the SEC on March 20, 2009. Investors and security holders may obtain information regarding the names,
affiliations and interests of Black & Decker’s directors and executive officers in Black & Decker’s Annual Report on Form 10-K for the year ended December 31, 2008, which was filed with the SEC on February 17, 2009,
and its proxy statement for its 2009 Annual Meeting, which was filed with the SEC on March 16, 2009. These documents can be obtained free of charge from the sources listed above. Additional information regarding
the interests of these individuals will also be included in the joint proxy statement/prospectus regarding the proposed transaction when it becomes available.
Non-Solicitation
A
registration statement relating to the securities to be issued by Stanley in the
proposed transaction will be filed with the SEC, and Stanley will not issue,
sell or accept offers to buy such securities prior to the time
such
registration statement becomes effective. This document shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of such securities, in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to appropriate registration or qualification under the securities laws of such jurisdiction.
registration statement becomes effective. This document shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of such securities, in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to appropriate registration or qualification under the securities laws of such jurisdiction.
Chairman
&
Chief Executive Officer
Chief Executive Officer
The
Stanley Works
John
F. Lundgren
Chairman,
President & Chief
Executive Officer
Executive Officer
The
Black & Decker Corporation
Nolan
D. Archibald
3
• Established
In 1843 By Frederick Trent
Stanley, Who Founded A Small
Hardware Manufacturing Shop In New
Britain, CT
Stanley, Who Founded A Small
Hardware Manufacturing Shop In New
Britain, CT
• 166
Year Reputation For Product
Quality And Service
Quality And Service
• 133
Years Of Consecutive Dividends
• World
Class Hand Tools Portfolio
• Established
In 1910 By S. Duncan
Black And Alonzo G. Decker, Who
Founded A Small Machine Shop In
Baltimore, MD
Black And Alonzo G. Decker, Who
Founded A Small Machine Shop In
Baltimore, MD
• 100
Year Reputation For Product
Innovation And Customer Focus
Innovation And Customer Focus
• 72
Years Of Consecutive Dividends
• World
Class Power Tools Portfolio
Two
Companies With Great Legacies
Rich
and Enduring Histories
4
Compelling
Strategic And Financial Benefits
Strategic
Benefits
Financial
Benefits
§ A Global Leader In
Hand and Power
Tools
Tools
§ Iconic Brand
Portfolio - Over 250
Years Of Combined History
Years Of Combined History
§ Greater Scale In
Hand And Power
Tools & Storage, Mechanical
Security, And Engineered Fastening
Tools & Storage, Mechanical
Security, And Engineered Fastening
§ World Class
Innovation Process
§ Global Low Cost
Sourcing And
Manufacturing Platforms
Manufacturing Platforms
§ Additional Presence
In High-Growth
Emerging Markets
Emerging Markets
§ Highly Accretive To
EPS;
Approximately $1.00 Per Share
Projected By Year 3
Approximately $1.00 Per Share
Projected By Year 3
§ $350M In Cost
Synergies Annually
§ Opportunity For
Margin Improvement
§ Free Cash Flow Of
Approximately
$1.0B And Over $1.5B In EBITDA By
Year 3
$1.0B And Over $1.5B In EBITDA By
Year 3
§ Increased Resources
To Invest In
Security Solutions, Engineered
Fastening And Other High-Growth
Platforms
Security Solutions, Engineered
Fastening And Other High-Growth
Platforms
§ Strong Balance
Sheet
5
Transaction
Highlights
|
Exchange
Ratio
|
Fixed Ratio Of
1.275 Shares Of SWK For Each Share Of BDK
Implied 22.1%
Premium To BDK As Of 10/30/09
|
|
Ownership
|
50.5% Stanley
/ 49.5% Black & Decker
|
|
Accretion
|
EPS Accretion
Of Approximately $1.00 Per Share Projected By Year 3
|
|
Synergies
|
$350M Cost
Synergies Annually, Fully Realized Within 3 Years
|
|
Board
of Directors
|
9
Directors From Stanley / 6 Directors From Black & Decker
Nolan D.
Archibald, Executive Chairman
|
|
Management
Team
|
John F.
Lundgren, President & CEO
James M.
Loree, EVP & COO
Donald Allan,
Jr., SVP & CFO
|
|
Company
Name
|
Stanley Black
& Decker
|
|
Headquarters
|
Corporate HQ
In New Britain, CT / Power Tools HQ In Towson, MD
|
|
Transaction
Close
|
Expected In
The First Half Of 2010
|
Transaction
Currently Valued At Approximately $4.5B
6
Highly
Complementary Iconic Brands
World-
Class
Class
Brand
Portfolio
Portfolio
Well
Known Brands Across All Segments
CDIY
Security
Industrial
Industrial
Engineered
Fastening
Fastening
Hardware
&
Home
Improvement
Home
Improvement
7
Comprehensive
Product Offering
No
Significant Product Line Overlap
8
Attractive
Positions In Markets And Channels Worldwide
§ Operations In 45
Countries With Strong Positions In
North America, Europe, Middle East and Latin America
North America, Europe, Middle East and Latin America
§ Growing Presence In
Emerging Markets Including Asia
& Eastern Europe
& Eastern Europe
§ Outstanding Access
To Key End Markets
Including Industrial, Construction, Automotive
Repair and DIY
Including Industrial, Construction, Automotive
Repair and DIY
An
Industry Leading Array Of Products & Services
§ Branded Hand Tools
& Storage
§ Cordless And Corded
Power Tools & Accessories
§ Mechanical Security
& Hardware
§ Electronic Security
Systems & Services
§ Engineered Fastening
Systems
Superior
Track Record Of Innovation
§ Laser Focus On End
Users
§ Strong Value
Propositions
§ Compatible
Cultures
§ Robust New Product
Pipeline & Continued
Commitment To Focused R&D
Commitment To Focused R&D
World
Class Operations And Global Sourcing
§ Stanley Fulfillment
System Operating Model
§ Low Cost Country
Manufacturing & Sourcing
§ Overlapping Physical
Distribution Systems
§ Committed To
Best-In-Class Working Capital Efficiency
Compelling
Strategic Combination
Executive
Vice President & Chief Operating Officer, The Stanley Works
James
M. Loree
10
Consistent
With Strategic Objectives
Stanley
Strategic Framework
In Place Since 2004
In Place Since 2004
§ Be
A Consolidator Of The Tool Industry
§ Increase
Relative Weighting Of Emerging Markets
Be
Selective and Operate In Markets Where:
§ Brand
Is Meaningful (Stanley Or Sub-Brand)
§ Value
Proposition Is Definable And Sustainable
Through Innovation
Through Innovation
§ Global
Cost Leadership Is Achievable
Pursue
Growth On Multiple Fronts Through:
§ Building
On Existing Growth Platforms
§ Developing
New Growth Platforms Over Time
Accelerate
Progress Via Stanley Fulfillment System
§ Increased
Scale In Hand And Power Tools
§ Greater
Presence In Latin America, Middle
East and Eastern Europe
East and Eastern Europe
§ Significant
Brand Equity
§ Extensive
Array of High Value-Added
Products And Strong Culture Of Innovation
Products And Strong Culture Of Innovation
§ Bringing
Together Two Cost Leaders
§ Increased
Size And Scale
§ Adds
Attractive New Engineered Fastening
Growth Platform
Growth Platform
Maintain
Portfolio Transition Momentum
Strategic
Benefits Of
Combination
Combination
Approximately
$1B In Free Cash Flow Annually To Build Growth
Platforms
11
Growth
Platforms
Existing
Growth Platforms
1.
Convergent Security
2.
Mechanical Security
3.
Industrial & Automotive Tools
New
Growth Platforms
4.
Engineered Fastening
5.
Healthcare
6.
Infrastructure
Capital
Focused On Driving Growth Within
Both Core and New Platforms…
Both Core and New Platforms…
§ Build Out Existing
Platforms
§ Expand Into Adjacent
Markets
§ Grow Through
Acquisitions
New
§ Expand Existing
Platforms
§ Grow
Organically
§ Expand
Internationally Via Acquisitions
12
Long-Term
Capital Allocation Strategy
Long-Term
Capital Allocation Objectives
§ Target Strong
Investment Grade Credit
Rating
Rating
§ Invest Approximately
2/3 In Acquisitions
And Growth
And Growth
§ Return Approximately
1/3 To
Shareholders
Shareholders
§ Committed To
Continued Dividend
Growth
Growth
Capital
Allocation Strategy Supports Strong Balance Sheet,
Shareholder Returns & Continued Growth
Shareholder Returns & Continued Growth
Capital
Allocation Objectives Remain Intact
13
A
Diversified Global Leader
Revenue
by
Segment
Segment
Revenues
Remain Diversified…
|
|
|||
|
Largest
Customer
|
22%
|
~6%
|
~12%
|
|
U.S.
Home Centers
& Mass Merchants |
40%
|
~13%
|
~24%
|
2002
2008
Pro
Forma
Back
to
Stanley 2006
Levels
Stanley 2006
Levels
…With
49% In CDIY
Stanley
2009E
Revenue: $3.7B*
Black
& Decker
2009E
Revenue: $4.7B*
Security
42%
42%
CDIY
34%
34%
Fastening &
Assembly Systems
11%
11%
Hardware
& Home
Improvement
16%
Improvement
16%
Pro
Forma
2009E Revenue: $8.4B
2009E Revenue: $8.4B
+
=
Power
Tools & Accessories
73%
73%
Security
28%
28%
CDIY
49%
49%
Industrial
23%
23%
$740M
$1B
$2.9B
Additive
Revenue From
Black & Decker to Existing
Stanley Business Segments
Black & Decker to Existing
Stanley Business Segments
*Source:
Wall Street Estimates
14
SFS
Can Be Leveraged Across Black & Decker Platform…
Added
Value of Stanley Fulfillment System (SFS)
…With
The Potential To Generate Significant Cash Flow
From Higher Working Capital Turns
From Higher Working Capital Turns
3.7x
3.7x
4.1x
2006A
2007A
2008A
SWK
BDK
7.0x
6.0x
5.0x
4.0x
3.0x
2.0x
1.0x
0.0x
Δ=
~$500M
Vice
President & Chief Financial Officer, The Stanley Works
Donald
Allan Jr.
16
Successful
Integration Track Record
Proven
Integration Process Drives
Significant Synergy Realization
Significant Synergy Realization
Operating
Margin %
§ Integration
Plan For First 100
Days Finalized Prior To Close
Days Finalized Prior To Close
§ Consensus On
Integration Plan With Both
Management Teams Prior To Close
Management Teams Prior To Close
§ Integration
Management Team Rhythms
And Milestones Each Week
And Milestones Each Week
§ Experienced
Integration Managers On Each
Team
Team
§ In-Country
Integration Teams Worldwide
Integration
Process Best Practices
Yields 6%
Margin
Improvement On
Average
Improvement On
Average
17
Cost
Synergy Drivers
Manufacturing
And Distribution
Purchasing
Business
Unit & Regional Integration
Corporate
Overhead
§ Plant
Footprint Consolidation
§ Distribution
Network Consolidation
§ Direct
And Indirect Materials
§ Freight
$350
Million Of Cost Synergies Identified (4% Of Pro Forma Sales)
One
Time Cost To Achieve
§ $400M
Over Three Years
One
Time Cost Of $400 Million To Achieve
Cost
Synergies ($M)
$350M
§ Public
Company Costs
§ Management,
Facility And IT Integration
§ Management
And Sales Force Integration
§ Regional
Shared Service Consolidation
Corporate
Overhead
Overhead
~$95M
Business
Unit &
Regional Consolidation
Regional Consolidation
~$135M
Purchasing
~$75M
Manufacturing
&
Distribution
Distribution
~$45M
18
Revenue
Synergies
§ Cross-Selling
Opportunities For Products Of
Both Companies In Mature Markets
Both Companies In Mature Markets
§ Expanded Product
Distribution Reach For
Both Companies
Both Companies
§ Increased Presence
And Scale In Emerging
Markets Will Accelerate Penetration And
Growth
Markets Will Accelerate Penetration And
Growth
§ Increased Scope And
Scale Of Innovation
Process Will Accelerate New Product
Development
Process Will Accelerate New Product
Development
§ Increased Cash Flow
Will Allow Greater Re-
Investment In Existing Brands, Channels
And Operations
Investment In Existing Brands, Channels
And Operations
Combination
Also Provides Substantial Revenue Synergy Potential
Any
Realized Revenue Synergies Represent Additional Future Upside
To Financial Forecasts
To Financial Forecasts
§ Utilize Stanley’s
Global Industrial And
Automotive Repair Channels To Sell
Additional DeWalt Power Tools
Automotive Repair Channels To Sell
Additional DeWalt Power Tools
§ Distribute Stanley
Hand Tools And
Hardware Through Black & Decker’s
Latin American Sales Force
Hardware Through Black & Decker’s
Latin American Sales Force
§ Leverage Black &
Decker’s Strong
Presence In The STAFDA* Channels
To Sell Additional Stanley Hand Tools
Presence In The STAFDA* Channels
To Sell Additional Stanley Hand Tools
Specific
Examples
*
Specialty Tools & Fasteners Distributors
Association
19
Pro
Forma Financial Impact To Stanley
|
|
Year
1
|
Year
2
|
Year
3
|
|
Annual
Cost
Synergies ($M) |
$125
|
$250
|
$350
|
|
Pro
Forma GAAP
EPS Accretion ($
per Fully
Diluted Share) |
($3.25)
-
($3.00) |
$0.25
- $0.35
|
$0.95
- $1.05
|
|
Pro
Forma
Adjusted EPS Accretion ($
per Fully
Diluted Share) |
($0.45)
-
($0.20) |
$0.50
- $0.60
|
$1.05
- $1.15
|
|
Pro
Forma Cash
EPS Accretion ($
per Fully
Diluted Share) |
($0.05)
- $0.20
|
$0.90
- $1.00
|
$1.40
- $1.50
|
Highly
Accretive Transaction Results In Approximately $5.00 Of EPS In
Year 3
Year 3
Creates
A Global
Leader With Pro
Forma 2009E
Revenues Of $8.4B
Leader With Pro
Forma 2009E
Revenues Of $8.4B
Free
Cash Flow In
Year 3 To Be ~$1B
Year 3 To Be ~$1B
EBITDA
Of $1.3B
Including Full Run-
Rate Synergies in
2009
Including Full Run-
Rate Synergies in
2009
Adjusted
EPS Cash
EPS
•
Annual Additional ~
$80-90M
Pre-Tax Intangible Amortization
Pre-Tax Intangible Amortization
GAAP
EPS Adjusted
EPS
•
Costs
To Achieve Synergies $400M
(Yr 1 - $330M, Yr 2 - $50M, Yr 3 - $20M)
(Yr 1 - $330M, Yr 2 - $50M, Yr 3 - $20M)
•
Non-Cash Inventory Charge $200M
(Yr 1 Only)
(Yr 1 Only)
•
Transaction/Other Expense $70M
(Yr 1 Only)
(Yr 1 Only)
20
Strong
Credit Position
|
|
Standalone
|
Combined
|
|
|
|
2009
Forecast |
2009
PF
Forecast |
Year
3 PF
Forecast |
|
Synergies
($M)
|
-
|
-
|
$350
|
|
EBITDA ($M)
|
~ $600
|
~
$1,000
|
~
$1,500
|
|
Free Cash
Flow
|
>
$300
|
~
$650
|
~ $1,000
|
|
Debt/EBITDA
|
1.7x
|
2.9x
|
~1.4x
|
|
Total Debt /
Capitalization
|
~
30%
|
~
30%
|
~
25%
|
|
Current
SWK
Standalone Credit Rating: |
|
S&P:
A
Moody’s:
A3
Fitch:
A
|
|
Current
BDK
Standalone Credit Rating |
|
S&P:
BBB
Moody’s:
Baa3
Fitch:
BBB
|
A
Strong Capacity To Maintain
A Conservative Financial Position…
A Conservative Financial Position…
…Will
Create An Even Stronger Company With A Solid Foundation
Combined
Company Credit Ratings Strong
Investment Grade
21
Liquidity
|
|
Post
Closing
Forecast |
|
Forecasted
Cash Position
|
$1.0B
|
|
Existing
Stanley Committed Credit
Facilities Expiring 2013 |
$.8B
|
|
Planned
New Credit Facilities
|
$.5B
- $.75B
|
|
Stanley’s
Stock Purchase Contract
Maturing Q2 2010 |
$.32B
|
|
Total
Near Term Liquidity
|
$2.62B
- $2.87B
|
Ample
Liquidity To Meet The Needs Of The New Company
Debt
Maturities
Combined
Debt Maturities ($M)
Near
Term Liquidity Sources
New
Credit Facility
(Assumes 364day Renewed Annually)
(Assumes 364day Renewed Annually)
SWK
Credit Facility
SWK
Stock Purchase Contract
SWK
BDK
Note:
2010 Maturities includes forecasted Y/E short term debt of SWK and
BDK as well as acceleration of $175MM of BDK term debt
BDK as well as acceleration of $175MM of BDK term debt
22
Consistent
With Stanley’s Financial Objectives
Sales
Growth
§ 3-5%
Organic
§ ~10%
Total
Financial
Performance
§ Mid-Teens
% EPS Growth
§ FCF
>
Net Income
§ ROCE
In The Range Of 12-15%
Dividend
§ Continued
Growth
Credit
Rating
§ Strong
Investment Grade
Stanley’s
Financial Objectives
In Place Since 2004
In Place Since 2004
Chairman
& Chief Executive Officer, The Stanley Works
John
F. Lundgren
24
Unique
Opportunity
Complementary
Global Product Offerings
Comprehensive
Array Of Iconic Brands
Enhances
Core Strengths Of Each Company
Creates
Stronger Global Company
Shared
Commitment To Operational Excellence
Substantial
Synergy Opportunities
Combination
Of Two Outstanding Companies
A
POWERFUL LEGACY, A FUTURE OF GROWTH