BREAKING: Sears closing 150 stores & selling the Craftsman brand for nearly $1 billion to Stanley Black & Decker!
Sales in store start this week. This is pretty big news in the marketing/business sector when a brand nearly 100 years old is sold or merged etc. in any sector.
The Illinois-based retailer announced it is selling the Craftsman brand for $525 million in cash at closing, plus an additional $250 million payment at the end of Year 3 and variable payments for up to 15 years.
The Sears brand announced it is closing 150 stores and that the 2 news items are related. The store closures include 108 KMart locations. Store closures to be completed by March they say.
Based on a news release, Sears will continue to sell Craftsman tools in its stores via a license in perpetuity from Stanley Black & Decker, who will receive royalties from Sears after a 15-year grace period.
Sears (Nasdaq: SHLD) says the net present value of the total deal is about $900 million.
The deal gives Connecticut-based Stanley Black & Decker (NYSE: SWK) the rights to make & sell Craftsman products in non-Sears channels in the U.S. and overseas.
In the deal, Sears will receive annual payments from new Stanley Black & Decker /Craftsman sales over a 15-year period. The retailer will get 2.5 % of sales through 2020, 3 % through January 2023, & 3.5 % for the balance of the agreed upon time in the contract.
Officials on the B&D side of the deal said they intend to invest in the brand and pursue market growth in various and new sectors and hope to increase manufacturing and thus jobs -- in the USA.
Image sources: localtvwtkr.files.wordpress.com, retailwire.com
First The Bay, then Zellers, now Sears. This is the end of the age of Big Box stores. Times are changing and if you do not change you can become extinct. Who moved my cheese?
The main owner of Sears Holdings has done 2 or 3 restructuring moves I learned recently, when I was X-reffing my research on this story today.
You are right. And the cheese line, is one I have not heard in ages, TY for that!
Yes, being in Canada like you we have seen some related changes like you mention.
That aren't named Wal-Mart...
But that said......Wal-Mart stock went nowhere from 1999 to 2011. It's picked up more recently, but not by all that much.
Eventually, Wal-Mart will become yesterday's company. If it can happen to McDonald's, it can certainly happen to Wally World. (Just think of all the burger chains that have started up in the last 25 years which have taken square aim at "McDick's".)
When Walmart went public they were one of MIke Milken's junk bonds...I bet he didn't get sued over those!!!
No, I bet was wasn't ;)
Agreed, Amazon is the new Walmart.
That's what it's becoming....
You can't stop the machine. You now have cheaper and cheaper products. Workers canned into a warehouse for 12 hour days. I like Amazon's products, speed of delivery but they will eventually be almost 100 percent automated. So those jobs like may others today will be eliminated by technology. Technology always wins.
True, that.
And here in Canada we had Target. For a little while anyway.
It lasted less than two years, and ended about two years ago:
http://mashable.com/2015/01/15/target-shut-canadian-stores/#FEV64.zYekqz
That's because target thought they could buy all the ghetto Zellers stores and revamp them into Target. But they forgot Canadians already new what to expect from the U.S chain. I once went back to Canada on a visit and new immediately the stores would fail. You could tell they just slapped everything together.
Step foot once in a Target in Canada (never in the U.S.), bought some things, and thought it felt wide and empty (specifically of people shopping).
http://finance.yahoo.com/news/craftmans-famous-lifetime-warranty-in-question-after-900-million-sale-202603636.html
People wondered about this right away on my main post, good find and remembering to come back here by you... thanks
nice
I hope Stanley Black & Decker honor lifetime warranty and maintain the quality craftsmanship of the "Craftsman" brand. Really the only tools I buy. Can't go wrong with that lifetime warranty.
You are bang on and in my research X-reffing this story today before posting, I had many of the same thoughts. I have 2 tool cribs.
I have quite a bit of Craftsman stuff and by and large, you are right -- good stuff.
Buy once, cry once and really -- well priced overall. TY for the comments
WOw, I wonder what this means for the prices of craftsman tools? Will the rise in prices because of this?
Probably not if the prices of B&D and Stanley are an indication. Stanley gets a little pricey, but B&D has historically been cheaper than Craftsman.
aaahh so it could go both ways. Who know which one it will be!
There are lots of good questions and comments in this thread like this! I saw this coming 3 yrs ago, and you know I live in the #PoliceState of #Canada watching things go down.
I wonder if they'll still carry the lifetime guarantee???
Upvoted and resteemed!
Saw it coming, read about it last year. Thanks for the info, this one was going to passed me by. Love to read news about economy, just not much into it these days.
https://www.bloomberg.com/news/articles/2016-06-03/sears-may-sell-its-best-known-brands
Saw this coming in Canada the last 36 mths TBH so today's news was big..... but not shocking.
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Thanks
Lampert destroying the icon.
Lampert is making the best of a terrible situation. Retail is collapsing around him. Sears is among the weakest of all the large retail groups in America. There is no way to save this business. So his job is to maximize the value of these assets for his shareholders. And that's precisely what he's doing.
...accounts of Lampert "burning the furniture" to keep the lights on. When you read that stuff, just chuckle. Lampert is turning the lights off as fast as he can, while extracting billions and billions in capital for Sears' owners (and himself, of course!)
TY for the comments