Stanley, Black & Decker Merger Well-Planned - Modern Distribution Management

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Stanley, Black & Decker Merger Well-Planned

The tool manufacturers have done their due diligence.
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Last week’s news about the merger between The Stanley Works and Black & Decker caught a lot of people off guard even though post-deal it’s evident that discussions between the two have been taking place for quite some time. If you look at the wealth of information the two companies have provided publicly, there’s little concern this move wasn’t well thought out.

"These companies know what they’re doing," says consultant Dan Perry of D. R. Perry and Associates. "They have a great post-acquisition strategy. They do their due diligence. And when they make the announcement, they make it based on the numbers and with the information to get things done."

And in this case – as it should be with most mergers – it includes having worked out a succession plan for the new company before one is absolutely needed. "That’s one of those things that shareholders are concerned with, the succession plan," Perry says. "And from my perspective, there’s a great succession plan here at the higher levels."

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John Lundgren, CEO of The Stanley Works, will take on that role in the new Stanley Black & Decker. Black & Decker’s current president & CEO Nolan Archibald will become the executive chairman for three years. The execs told investors and analysts last week that the decision was made in part because of the age difference between the two execs: Archibald is Lundgren’s senior by eight years.

Having that succession plan in place before the merger is finalized will reassure shareholders and customers that the decisions are being made for the long-term and that continuity is important in the new company.

Read more in-depth analysis of The Stanley Works and Black & Decker merger and what it means for distributors in the latest issue of MDM Premium.

 

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