- Spectrum Brands Holdings Inc SPB has agreed to sell its Hardware & Home Improvement (HHI) segment to ASSA ABLOY ASAZY, a Swedish conglomerate, for $4.3 billion in cash.
- HHI division provides security, plumbing, and builders' hardware products to the North American residential segment. Lake Forest, California-based HHI has about 7,500 employees worldwide.
- HHI clocked $1.3 billion in net sales for the fiscal year ending September 2020 with an adjusted EBITDA margin of around 19%.
- Spectrum Brands expects to receive $3.5 billion in net proceeds and plans to use it to repay debt and reduce its gross leverage ratio to 2.5x times in the near term.
- Spectrum Brands expects to maintain its quarterly cash dividend of $0.42 per common share, which will be subject to continued review from time to time.
- The deal is expected to be closed in Q4 2021.
- Following this sale, Spectrum Brands will consist of three focused business units: Global Pet Care, Home & Garden, and Home and Personal Care.
- Price Action: SPB shares closed higher by 17.79% at $93.08 on Wednesday.
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