ASSA ABLOY has signed a definitive agreement to acquire the Hardware and Home Improvement (HHI) division of Spectrum Brands (SPB) for a purchase price of MUSD 4,300 on a cash and debt free basis. Spectrum Brands’ Hardware and Home Improvement (HHI) division is a renowned provider of security, plumbing, and builders’ hardware products to the North American residential segment, with a diversified product offering of locksets, faucets, and builders´ hardware. Hardware and Home Improvement Hardware and Home Improvement has a varied portfolio of innovative products, including patented SmartKey technology Hardware and Home Improvement (HHI) has a varied portfolio of innovative products, including patented SmartKey technology and electronic, smart and biometric locks. Key brands include Kwikset, Baldwin, Weiser, Pfister and National Hardware. HHI has strong, established relationships with a variety of customers, including large home improvement centers, wholesale distributors, home builders, online retail channels and home automation providers. For the fiscal year ending September 2020, HHI’s net sales were MUSD 1,342, with adjusted EBITDA margin of around 19%. HHI is headquartered in Lake Forest, California, with some 7,500 employees worldwide and has manufacturing facilities in the United States of America, Mexico, Taiwan, China and the Philippines. Transformation from mechanical to digital solutions “HHI is an excellent addition to the ASSA ABLOY Group and constitutes an important strategic step in developing our residential business in North America. This acquisition advances our strategy to strengthen our position, by adding complementary products to the core business and it will further accelerate the transformation from mechanical to digital solutions,” said Nico Delvaux, President and Chief Executive Officer (CEO) of ASSA ABLOY. Nico Delvaux adds, “I look forward to welcoming HHI and all of its employees into the ASSA ABLOY Group.” Lucas Boselli, Executive Vice President of ASSA ABLOY and Head of the Americas Division, said “The acquisition of HHI brings strong, well-known brands and high-quality, innovative products to the residential portfolio for ASSA ABLOY in North America, complementing our current business with a passionate and experienced team.” Technology platform and innovation focus Lucas Boselli adds, “Our technology platform and innovation focus supplements HHI’s current offerings and provides an exciting opportunity for us to deliver superior value to consumers.” “After stewarding this asset for the past decade, the Board of Directors and I are confident that ASSA ABLOY is uniquely positioned to take our HHI business and team members to the next level of performance and achievement. I am personally excited to see the innovation and exciting new products that this transaction will unlock for future generations,” said David M. Maura, Executive Chairman and Chief Executive Officer (CEO) of Spectrum Brands Holdings Inc. Background of the HHI acquisition HHI complements ASSA ABLOY, in terms of both product offering and geographic scope ASSA ABLOY has tremendous respect for the achievements of HHI, which is a great company with a proven track record. HHI complements ASSA ABLOY, in terms of both product offering and geographic scope, with well-known brands, a strong culture and values, high quality products and skilled employees, managed by a professional team. HHI constitutes a strategically important step in developing ASSA ABLOY’s residential business in North America, supplementing the company’s strong reputation for innovation on the commercial side. HHI brings a deep knowledge of the residential business and adds complementary products, technology and solutions. Major consumer brands added to portfolio HHI adds established consumer brands in North America, including Kwikset, Baldwin, Weiser, Pfister and National Hardware, to our brand portfolio. ASSA ABLOY can bring technological innovation to consumers, which are using HHI’s access to new retail channels, such as home builders and DIY retail. HHI’s large installed base and great consumer reputation provides an excellent opportunity, to grow their electro-mechanical and digital access solutions. HHI has a long track record of innovation, especially within SmartKey technology, which will complement ASSA ABLOY´s offering. ASSA ABLOY expects strong synergies, the largest components being their increased product offering, advances in technology, distribution and procurement. The EBIT synergies are expected to reach around MUSD 100 in 2025. Focus on residential space in North America HHI focuses on the residential space in North America, which is highly attractive, underpinned by favorable macro trends, such as recent strong home sales, housing starts, an aging housing stock and increased consumer focus on home repair and re-modeling. HHI will become part of the Opening Solutions Americas Division of ASSA ABLOY. Financing of the acquisition and financial terms ASSA ABLOY maintains its commitment to a strong investment grade credit rating profile The transaction will be fully funded by existing cash and new debt. ASSA ABLOY maintains its commitment to a strong investment grade credit rating profile. The total consideration for the acquisition of HHI amounts to MUSD 4,300, on a cash and debt free basis. For the fiscal year ending September 2020, HHI’s net sales were MUSD 1,342, with adjusted EBITDA margin of around 19%. Based on publicly available financial information for 2020, for both HHI and ASSA ABLOY, the acquisition of HHI will add around 14% to ASSA ABLOY´s consolidated sales. The operating margin effect for ASSA ABLOY is initially expected to be dilutive. The acquisition will be accretive to EPS from the start. Total purchase price of MUSD 4,300 reflects a multiple of 14x expected fiscal year 2021 (30 September), adjusted EBITDA of the HHI segment. The purchase price net of the present value of tax benefits represents a multiple of approximately 10x adjusted EBITDA, including synergies. Conditions for the transaction The transaction is conditional upon regulatory approval and customary closing conditions, and is expected to close during the fourth quarter of 2021. ASSA ABLOY has agreed to pay a termination fee of MUSD 350 in certain circumstances, if the transaction agreement would be terminated and required regulatory approvals would not have been obtained. ASSA ABLOY is being advised by BofA Securities as exclusive financial advisor, and Linklaters LLP and Hogan Lovells as legal advisors. A conference call will be held at 08:00 am (CET), on Thursday, September 9, 2021. During the conference call, ASSA ABLOY´s President and Chief Executive Officer (CEO) - Nico Delvaux, the Chief Financial Officer (CFO) - Erik Pieder and the Head of the Americas Division - Lucas Boselli will describe the acquisition and respond to questions related to the transaction deal.
ASSA ABLOY has acquired Sure-Loc, a supplier of residential locks and associated hardware in the US. "I am very pleased to welcome Sure-Loc into the ASSA ABLOY Group. This acquisition delivers on our strategy to strengthen our position in the mature markets through adding complementary products and solutions to our core business,” says Nico Delvaux, President, and CEO of ASSA ABLOY. To grow residential business "The acquisition of Sure-Loc complements our mechanical hardware portfolio, supporting our ambitions to grow our residential business in the US," says Lucas Boselli, Executive Vice President of ASSA ABLOY and Head of the Americas Division. “Sure-Loc’s reputation for quality products and excellent customer service reflect our values and I’m excited for them to become part of ASSA ABLOY.”
ASSA ABLOY has announced acquiring Olimpia Hardware, renowned glass hardware and accessories brand in Latin America and the Caribbean. "I am very pleased to welcome Olimpia into the ASSA ABLOY Group. This constitutes an important next step in our strategy to grow market leadership in emerging markets,” said Nico Delvaux, President and Chief Executive Officer (CEO) of ASSA ABLOY. Acquisition of Olimpia Hardware "The addition of Olimpia complements our business in Latin America, further supporting the growing trend of openings utilizing glass and aluminum products," said Lucas Boselli, Executive Vice President of ASSA ABLOY and Head of the Americas Division. Olimpia Hardware was established in 1999 and serves Latin America and the Caribbean regions. ASSA ABLOY will continue to sell Olimpia branded products across the region. Sales for 2019 amounted to about 13 MUSD (approx. 125 MSEK) with a good EBIT margin. The acquisition will be accretive to EPS from start.
ASSA ABLOY has acquired LifeSafety Power, a US supplier of smart integrated access control power solutions for OEMs, integrators and end-users. "I am very pleased to welcome LifeSafety Power into the ASSA ABLOY Group. LifeSafety Power constitutes a strategic addition to the Group and reinforces our position in access control solutions,” says Nico Delvaux, President and CEO of ASSA ABLOY. Access control portfolio "LifeSafety Power is a great complement to our access control portfolio – we are looking forward to incorporating their knowledge of power supply as well as power consumption throughout our access control portfolio," says Lucas Boselli, Executive Vice President of ASSA ABLOY and Head of the Americas Division. LifeSafety Power was established in 2009 and has some 65 employees. The main office is located in Libertyville, Illinois. Sales for 2019 are expected to reach about USD 30 million (approx. SEK 290 million) with a good EBIT margin and the acquisition will be accretive to EPS from start.