Newell Rubbermaid buys American Tool

Newell Rubbermaid Inc., Freeport, IL, has agreed to acquire American Tool Companies, Inc., Hoffman Estates, IL, a manufacturer of hand tools and power tool accessories, in which Newell Rubbermaid already holds a 49.5 percent stake. Purchase price is $419 million, which includes cash for the majority shareholder's equity and American Tool's debt.

The deal marks a significant expansion and enhancement of the company's product lines and customer base, launching it squarely into the estimated $10 billion-plus global market for hand tools and power tool accessories. With fiscal 2001 revenue of $443.6 million and manufacturing and distribution facilities in the U.S., Europe, South America, Australia and Asia, American Tool provides Newell Rubbermaid with a complementary business of substantial size and scope in the fast-growing 'do-it-yourself' consumer market and also gives the company a strong platform to sell to the industrial and construction market.

American Tool will be merged into and managed by Newell Rubbermaid's Levolor/Hardware Group, which in 2001 accounted for $1.4 billion of the company's $7 billion in sales. The group manufactures and markets BernzOmatic torches; paint applicators and accessories under the Shur-Line and Rubbermaid brands; cabinet and door hardware under the Amerock and Douglas Kane brands; and window fashions under the Levolor, Kirsch, Gardinia and Swish brands.

American Tool's product portfolio includes branded hand tools such as Vise-Grip pliers, Quik-Grip hand clamps, Record vices, Straight- Line marking tools and Prosnip snips, in addition to power tool accessories such as Irwin and Speedbor wood boring bits, Hanson drill bits, Marathon saw blades, Joran masonry drill bits and Unibit step drills. Its products are distributed through large home improvement retailers in North America, Latin America, Europe and Australia, and through industrial and construction distributors, who represent a growth channel for the company.

'American Tool is an outstanding strategic fit for our company,' said Joseph Galli, Jr., Newell Rubbermaid's CEO. 'This acquisition gives us significant scale in the growing ﾑdo-it-yourself' retailing market and bolsters our product development capabilities across the high potential hardware and home improvement sectors. Given the extreme fragmentation in hand tools and power tool accessories, we believe Newell Rubbermaid has a great opportunity to achieve a leadership position in these markets.'

The Levolor/Hardware Group is led by James J. Roberts, who, along with Galli, has extensive experience in the hand tools and power tools accessories businesses. During a 19-year career at Black & Decker, Roberts served as president of the company's Worldwide Accessories business and earlier was vice president and general manager of Professional Power Tools-Europe. Prior to joining Newell Rubbermaid in 2001, he was president of Worldwide Hand Tools and Hardware for The Stanley Works.

During 19 years at Black & Decker, Galli became president of Black & Decker Power Tools and later president of Black & Decker Worldwide. Earlier, he was vice president of marketing and sales for the Black & Decker and DeWalt Power Tool Accessories business.

American Tool was formed in 1985 to purchase the business of Petersen Manufacturing Co., founded in 1924 by William Petersen, who invented the Vise-Grip locking plier. The company operates 20 manufacturing facilities and employs over 4,600 people. Under the leadership of Allen Petersen, the majority owner and the grandson of William Petersen, American Tool has grown into one of the world's largest manufacturers of hand tools and power tool accessories. Newell Rubbermaid's stake in American Tool dates to 1985.