Porter-Cable and Black & Decker, two historic brands jointly credited for developing the cordless power drill, are soon to merge under one roof.
Pentair Inc., Golden Valley, Minn., has agreed to sell its power-tool business of various woodworking tools, pressure washers, generators and air compressors to Black & Decker Corp., Towson, Md. Brands included in the sale are Porter-Cable, Delta, DeVilbiss Air Power, Oldham Saw and Flex. Officials at both firms say they expect to close the $775-million deal by the end of the year.
Nolan D. Archibald, Black & Decker chairman and CEO, calls the move an "ideal bolt-on acquisition" and says it offers "excellent strategic and financial benefits" for the $4.48-billion-a-year tool manufacturer. The deal is expected to expand Black & Decker's market share significantly and complement its high-performance DeWalt lineup.
After announcing new discounting strategies last year, Pentair leaders say they still struggled with what they call "competitive" challenges in the power-tool sector. The firm announced on July 19 that it had signed a "definitive" agreement to exit the business in a move to pay down company debt accrued from an $874-million acquisition of Milwaukee-based Wicor Industries water-handling equipment, finalized on Aug. 2.
The tool sale, which still awaits final regulatory approval, would remove Pentairs balance sheet from cash-flow scrutiny, according to an Aug. 31 credit report issued by New York-based Standard & Poors, which, like ENR, is part of the McGraw-Hill Cos.
Pentair sold $283.4 million in tools during the second quarter of this year, about the same as last years second quarter. The tool division brought in total sales of $1.08 billion last year.
The deal would end a bitter rivalry between the two brands. Black & Decker and Porter-Cable introduced the world's first cordless power drills, though crude by today's standards, in the early 1960s. Under Pentair's leadership since 1981, Porter-Cable raised the bar again when it launched its first 12-volt battery pack in 1989.