ASSA ABLOY Sells Emtek, Smart Residential Business in US and CanadaDecember 2nd, 2022 by Editor
ASSA ABLOY says it has entered into binding agreements with Fortune Brands Home & Security Inc. to sell Emtek and the Smart Residential business in the U.S. and Canada. The transaction is ASSA ABLOY’s bid to fully resolve alleged competitive concerns surrounding its proposed acquisition of the Hardware and Home Improvement (HHI) division of Spectrum Brands, initially announced in September 2021.
ASSA ABLOY’s agreement to acquire the HHI division of Spectrum Brands last year included a purchase price of $4.3 billion on a cash and debt free basis, and was announced on September 8, 2021. On September 15, 2022, the U.S. Department of Justice (DOJ) blocked the proposed acquisition of HHI. Two months ago, ASSA ABLOY announced that it would sell Emtek and the Smart Residential businesses, as a way to address the DOJ’s concerns.
On Thursday, December 1, ASSA ABLOY found a buyer, and entered into binding agreements with Fortune Brands. Residential businesses outside of the U.S. and Canada are not in scope to be divested.
These businesses represented sales of about $350 million in 2021. The selling price for the divested business is $800 million on a cash and debt free basis.
“With Fortune Brands our excellent U.S. and Canadian residential businesses will get a good and strong home with an experienced owner. While keeping these residential businesses in the U.S. and Canada would have been preferred, we are confident that we have now fully eliminated all competitive concerns alleged by the DOJ and that the acquisition of HHI is in the long-term interest of our shareholders,” says Nico Delvaux, president and CEO of ASSA ABLOY.
The divestiture is dependent on the successful defense against the DOJ regarding the planned acquisition of HHI. ASSA ABLOY says it remains “fully committed to these well-performing businesses” during the process and that all of the businesses will continue to operate as normal.
Both the proposed acquisition of HHI and the divestiture are expected to close during the second quarter of 2023.