DUBLIN (dpa-AFX) - Allegion Plc (ALLE), a provider of security products and solutions, Friday said it has signed a definitive agreement to acquire Stanley Access Technologies LLC and assets related to the automatic entrance solutions business from Stanley Black & Decker, Inc. (SWK) for $900 million in cash.
When adjusted for approximately $90 million in tax benefits, the purchase price is $810 million on a cash-free, debt-free basis.
The acquisition, which has been unanimously approved by Allegion's Board of Directors, is expected to close in the third quarter of 2022, subject to regulatory approval and customary closing conditions.
Following the close of the acquisition, Allegion expects to operate the Access Technologies business as part of the Allegion Americas segment.
Access Technologies is a manufacturer, installer and service provider of automatic doors in North America. The company generated approximately $340 million in net sales in 2021.
With the acquisition, Allegion expects to significantly expand its breadth of access, egress and access control solutions.
The transaction is not subject to a financing condition.
Allegion intends to finance the transaction through a combination of cash, borrowings under its existing revolving credit facility and new debt financing.
Further, in its trading update, Allegion business, on a standalone basis, is projecting first-quarter revenue of approximately $723 million and earnings per share of approximately $1.05, with an adjusted earnings per share of approximately $1.07. The company affirmed its previously reported standalone full-year 2022 outlook for earnings per share of $5.50 to $5.70 on a reported basis and $5.55 to $5.75 on an adjusted basis.
Separately, Stanley Black & Decker said the net proceeds from the sale are expected to be used to fund its previously announced share repurchase program as well as debt reduction. The company expects to record Access Technologies as discontinued operations when it reports first quarter results on April 28.
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