Stanley Black & Decker, an S&P 500 global diversified industrial company, announced that it has made an offer to acquire all of the outstanding common stock and warrants of Niscayah, a leading commercial security and monitoring company specializing in electronic security services and solutions based in Stockholm, Sweden, for SEK18.00 per share in cash. The total transaction value including assumed financial debt would be SEK7.6 billion (USD$1.2 billion).
Stanley Black & Decker, an S&P 500 global diversified industrial company, announced that it has made an offer to acquire all of the outstanding common stock and warrants of Niscayah, a leading commercial security and monitoring company specializing in electronic security services and solutions based in Stockholm, Sweden, for SEK18.00 per share in cash. The total transaction value including assumed financial debt would be SEK7.6 billion (USD$1.2 billion).
The Offer represents a 47 percent premium to Niscayah's closing price prior to the disclosure of Securitas AB's offer to acquire Niscayah on May 16, 2011, a 24 percent premium to the current value of Securitas AB's all-stock offer and a 15 percent premium to Niscayah's stock price at close on June 23rd, 2011.
The independent committee of Niscayah's Board has unanimously recommended that Niscayah shareholders and warrant holders accept the Offer. Niscayah shareholders representing approximately 19.5 percent of Niscayah shares have committed to accept the Offer under certain conditions. With estimated 2011 revenue of approximately USD$1 billion, Niscayah is one of the world's most attractive commercial security and monitoring companies and one of the largest access control and surveillance solutions providers in Europe. Niscayah's integrated security solutions include video surveillance, access control, intrusion alarms and fire alarm systems, and its offerings include design and installation services, maintenance and repair, and monitoring systems. The proposed acquisition would expand and complement Stanley Black & Decker's existing security product offerings and further diversify the Company's operations and international presence.
Niscayah's business is well-diversified across Northern, Central, and Southern Europe and the Nordic Region, as well as in the United States. Stanley Black & Decker's existing CSS business revenues are approximately USD$800 million, of which Europe represents approximately USD$300 million.
Stanley Black & Decker expects the transaction to result in annual cost savings of approximately USD$80 million, more than half of which would be realized by the end of year one after closing. The acquisition is also expected to be immediately accretive to Stanley Black & Decker's earnings per share (EPS), with accretion of USD$0.20 in year one and USD$0.45 in year three, excluding acquisition-related charges of $60 - $80 million which will largely be incurred during year one. The acquisition would be funded with Stanley Black & Decker's existing offshore cash resources with no additional debt or equity issuances.
President and CEO, John F. Lundgren, commented, “Our offer to acquire Niscayah is consistent with our strategy to build on our attractive growth platforms and create value for Stanley Black & Decker shareholders. Niscayah is a company we know well and is an ideal fit with our Convergent Security Solutions business as it brings complementary geographic strength and services, affords substantial synergies, strengthens our customer value proposition and enhances our growth potential in the highly attractive commercial security sector. We are providing all Niscayah shareholders the opportunity to receive an all-cash, superior offer at a significant premium, and we are very pleased to have the unanimous recommendation of the independent committee of Niscayah's board and the support of two major shareholders.”
Lundgren continued, “This acquisition also provides us with an excellent opportunity to utilize our offshore cash for a transaction that is expected to produce meaningful EPS accretion immediately. Our electronic security solutions team has requisite skills and experience to integrate Niscayah successfully as they have with HSM, Sonitrol, Générale de Protection, and most recently, ADT France.” The Offer is subject to customary conditions for a public offer in Sweden, including anti-trust approvals and the acceptance of the Offer to such an extent that Stanley Black & Decker becomes the owner of more than 90 percent of the total number of shares in Niscayah. The transaction is expected to close in September 2011.