Stanley Begins Integrating $1.2B Niscayah Acquisition
Stanley Black & Decker, New Britain, Conn., parent company of Stanley Convergent Security Solutions, finalized its acquisition of Niscayah, Stockholm, Sweden. Following the completion of the acquisition on Sept. 9, 2011, Stanley and Niscayah’s leadership began work on assimilating Niscayah’s security business, which included residential customers and commercial markets including banks, retail, gas stations, utilities, transport and lodging and public sector companies to which it provides integrated security solutions, video surveillance and access control systems, fire and security systems and monitoring services.
“The completion of our acquisition of Niscayah is an important step in both the ongoing expansion of one of our key growth platforms — Convergent Security Solutions (CSS) — and the diversification of the company’s operations and international presence,” said John Lundgren, president and chief executive officer of Stanley Black & Decker, in a press release. “The addition of Niscayah to CSS enhances our ability to serve our customers by giving us expanded product offerings and a wider geographic footprint in the highly attractive commercial security sector.”
Commenting on integration plans, Brett Bontrager, senior vice president and group executive, Stanley Security Solutions, told SDM, “Niscayah will operate as part of the broader Stanley Black & Decker family of businesses, within the Stanley Convergent Security Solutions ‘CSS’ group. The integration of Niscayah with Stanley CSS is an important step in further strengthening Stanley Black & Decker’s global security enterprise. Where it delivers strong and immediate benefit to customers, employees and the company, the integration will be implemented as soon as possible; while other integration activities will be timed for medium and long-term benefit.
“We will have key leaders and team members from both companies dedicated to identifying integration benefits, implementing integration plans and operating the new entity. The integration planning process began formally after the close of the transaction on September 9 and thus it is too early to comment on any specific integration plans.”
Stanley Black & Decker expects the transaction to result in annual cost savings of approximately $80 million, more than half of which would be realized by the end of year one after closing. The acquisition was funded with Stanley Black & Decker’s existing offshore cash resources with no additional debt or equity issuances.
Niscayah’s important European presence was a key attracting factor for Stanley, providing an opportunity to significantly grow its footprint. “Niscayah will add scale to our North American business as well as expand our presence into 12-plus countries/regions where we currently do not have a Security Solutions presence,” said Bontrager.
The acquisition closed after Stanley Black & Decker offered to purchase Niscayah for $1.2 billion in cash on June 27, 2011, beating a competing offer by former Niscayah owner, Securitas. Shortly after Stanley announced its intent to purchase Niscayah, the Independent Committee of the board of directors of Niscayah released a statement that unanimously recommended that shareholders and warrant holders accept the public offer made by Stanley Black & Decker.
“Stanley Black & Decker’s success with acquisitions comes from leveraging the best from both companies in a fashion that increases the strength of the combined entity,” Bontrager said. “Many of the key features of the Niscayah business model complement those of Stanley CSS. We see the integration process as an ideal way to unlock the enhanced strength of the combined entity. Since customers, employees and strategic partners are the key components to making an acquisition a success, the integration process and timing of Niscayah will be based on the benefit to customers, the business operations and the company.”