- Last week, Fortune Brands Innovations Inc FBIN got a green signal from authorities to proceed with the previously announced acquisition of businesses from ASSA ABLOY, Inc ASAZF.
- The Department of Justice, ASSA ABLOY, Spectrum Brands Holdings Inc SPB, and Fortune Brands announced the successful resolution of the impending litigation upon which the acquisition was conditioned.
- The acquisition disclosed on December 1, 2022, comprised ASSA ABLOY's hardware business - Emtek and Schaub premium luxury door and cabinet hardware business and the US and Canadian Yale and August residential smart home locks business.
- The purchase price of the acquisition is $800 million, or about $700 million net of tax benefits, in cash on a cash-free, debt-free basis. FBIN will receive tax benefits for over 15 years with a net present value of around $100 million, and the net purchase price of $700 million signifies 7.8x 2022 adjusted EBITDA for FBIN, before synergies.
- With the acquisition, FBIN's security and connected smart home portfolio in the U.S. and Canada will get a boost from the addition of Yale and August business. Also, Emtek and Schaub business will complement FBIN's House of Rohl suite of brands.
- The acquisition is expected to close by June 30, 2023. For 2023, the company expects the acquisition to generate net sales of $190 million-$210 million and EPS of $0.02 to $0.04.
- Post-acquisition in the third full year, FBIN expects to generate net sales of $500 million to $550 million and projects EPS accretion of $0.45 to $0.55.
- Price Action: FBIN shares closed higher by 2.32% at $63.85 on Friday.
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