Stanley Black And Decker Merger

Stanley Black & Decker Case Summary
Stanley Works a hand tool company was established in 1843, with its headquarter located at 480 Myrtle Street in New Britain, Connecticut. Black and Decker Corporation was founded in 1910 the largest power tool company with its headquarters located in Towson, Maryland. Stanley Works had acquired more than 30 companies over the years ranging from 1937- 2012 and although the both were in similar industry, there was the planning of a merger for a long time. November 2, 2009, Stanley Work and Black and Decker, board of directors agreed to a merger in which both companies would agree to the exchange of stock. Through the acquisition, Black and Decker paying them $3.6 billion and therefore having 50.5% of the stock.

With all the above reasons, we conclude that’s why Stanley Works was the better choice to the acquirer

Q2: The company is expecting $ 350M in annual cost synergies as a result of the merger. Discuss and evaluate (not financially, just verbally) the relative difficulty of achieving these savings based on each type of synergy detailed in Exhibit 1. Be specific
Some of the difficulties achieving these savings based on the diverse types of synergies were
Manufacturing and Distribution
 Supply chain
 Locations
 Inventory storage
 Difference in manufacturing process
 Preparation of the workers
 Circulation
 Additional training for employees
Savings -Purchasing
 Direct and Indirect material- difference in requirement standards the old vs new
 Standard differences
 Increasing the consumers base
 Freight
 Relationship with different financial institutions
 Location of warehouse
 All the synergies are not generating enough cash flow

Saving Corporate -Overhead
 Public company cost
 Charity
 Business

The savings associated with the merger transacon was a strong movaonal factor. However, the net present value which is used to analyze a project pro'tability at the me of investment, indicates a negave $200 million if there was no terminal cost. Hence, the present value at a future me is not favorable for stockholders and this is my reason for vong against the merger. Furthermore, speculaons would be adverse and not to my bene't
Q5: If you were a shareholder of Stanley, would you vote for in favor of this merger,