WASHINGTON — Stanley Black & Decker will buy Sears’ Craftsman tools division in a deal worth about $900 million.
Stanley Black & Decker said it will expand production of the iconic Sears tool brand, create new manufacturing jobs in the U.S. and further expand sales of Sears tools outside of Sears stores.
“Craftsman is a legendary, American brand with tremendous consumer awareness built on a legacy of producing quality products at a great value,” said Stanley Black & Decker Chief Executive James Loree.
“This agreement represents a significant opportunity to grow the market by increasing the availability of Craftsman products to consumers in previously under-penetrated channels,” he said.
Craftsman tools are currently available at a handful of non-Sears retailers, including Costco and Ace Hardware, but those sales represent a fraction of total Craftsman revenue.
Cash-strapped Sears will get an upfront $525 million payment at closing, and another $250 million after three years. Stanley Black & Decker also will make annual payments, based on Craftsman sales, for 15 years.
After 15 years, Sears will start paying Stanley 3 percent of the Craftsman sales it makes.
Sears acquired the Craftsman brand in 1927 for $500, according to Bloomberg News.
Black & Decker was a Towson, Maryland-based company, founded in 1910. Stanley Works acquired Black & Decker in 2010.
Stanley, based in New Britain, Connecticut, makes and sells tools under several brands, including Stanley, DeWalt and Black & Decker.
The Associated Press contributed to this report.