Newell Brands to sell majority of its tools business
Newell Brands Inc. announced that it intends to sell a majority of its tools segment following a strategic review of its business.
The company announced a series of changes related to a comprehensive strategic review of its business conducted since the completion of the Newell Rubbermaid and Jarden combination.
Newell Brands will transform from a holding company to an operating company, and will consolidate its existing 32 business units to 16 operating divisions, including the creation of a new global enterprise-wide e-Commerce Division. The company will also focus and strengthen its portfolio by holding a number of businesses for sale, using the proceeds primarily to accelerate debt pay down, and creating a platform for future acquisitions that strengthen and scale the company’s core businesses.
The businesses held for sale represent about 10 percent of the portfolio and include the vast majority of the Tools Segment, the Winter Sports businesses within the Outdoor Solutions Segment, the Heaters, Humidifiers, and Fans businesses within the Consumer Solutions Segment, and the Consumer Storage Container business within the Home Solutions Segment. The total 2015 net sales of the businesses held for sale are approximately $1.5 billion, and include about $100 million of the $250 to $300 million of previously announced exits or assets held for sale.
“Newell Brands new strategic plan establishes a clear set of investment priorities, a new organization design for the company, and a sharp set of portfolio choices that will focus our resources on the businesses with the greatest potential for growth and value creation,” said Michael Polk, Newell Brands chief executive officer. “We will drive growth acceleration over time through more effective and scaled commercial operations, increased investment in our brands and capabilities, and the delivery of bigger, better innovation across a broader set of categories. We will simultaneously expand margins through significant cost synergies and other savings related to the combination of Newell Rubbermaid and Jarden and other cost focused initiatives."
The sale processes are underway and the company hopes to complete the divestiture of the assets held for sale within the first half of 2017.
Newell Brands in the tool segment include Irwin, Lenox, hilmor and DYMO.