Jan 6, 2003
FREEPORT, Ill., January 6, 2003 - Newell Rubbermaid Inc. (NYSE: NWL) today announced that it has completed its acquisition of American Saw & Mfg. Company. American Saw, a leading manufacturer of linear edge power tool accessories, hand tools and band saw blades marketed under the Lenox® brand, was purchased for $450 million in cash. The deal marks the continued expansion and enhancement of the company's product lines and customer base in the $12 billion global power tool accessories and hand tools market and strengthens the company's platform in the professional and fast growing "do-it-yourself" channels.
The transaction was structured as a purchase of assets, which permits the deduction of goodwill for tax purposes. Newell Rubbermaid estimates the present value of the future tax benefit to be $85 million, which effectively reduces the purchase price of the acquisition to approximately $365 million, or 5.9 times 2001 EBITDA. The purchase is expected to contribute $0.04 to Newell Rubbermaid's 2003 earnings per share. As a result, the company raised its full-year 2003 guidance and now expects diluted earnings per share, excluding charges, to be in the range of $1.77 - $1.87.
"The combination of American Saw with our American Tool business strengthens our presence in both the retail and professional channels and gives us the opportunity to leverage new product development and sales and marketing efforts at strategic accounts," said Joseph Galli, Jr., Newell Rubbermaid's chief executive officer. "Adding the powerful Lenox® brand to our existing Irwin® branded power tool accessories and Vise-Grip®, Quick-Grip® and BernzOmatic® hand tools offerings firmly establishes the company as a leader in the global power tool accessories and hand tools market, positioning us for accelerated long-term growth."
The company also announced that it has appointed William A. Burke III as president of the American Saw business. Burke, age 42, joined Newell Rubbermaid in December of last year as group vice president business development of its power tool accessories and hand tools business. Prior to Newell Rubbermaid, Burke gained nearly 20 years industry experience with Black & Decker, where he most recently served as vice president, general manager of its product service division. In his new role, Burke will be responsible for the American Saw business with a heightened focus on product development, brand building capabilities and operational excellence. He will continue to report to James Roberts, group president of Newell Rubbermaid's Levolor Hardware Group, which in 2001 accounted for $1.4 billion of the company's nearly $7 billion in sales.
"Bill has an outstanding reputation as a strong results oriented business leader and is well known for promoting a winning culture. Bill's strength in brand building, global product development, and marketing complement a strong operating team already in place," said Jim Roberts.
The statements contained in this press release that are not historical in nature, including the expected contribution to earnings per share in 2003 and the effect of the future tax benefit related to the acquisition, are forward-looking statements. Forward-looking statements are not guarantees since there are inherent difficulties in predicting future results, and actual results could differ materially from those expressed or implied in the forward-looking statements. For a list of major factors that could cause actual results to differ materially from those projected, refer to Newell Rubbermaid's third quarter 2002 Form 10-Q Exhibit 99, filed with the Securities and Exchange Commission.