An email has been sent to your address with instructions for changing your password.
There is no user registered with this email.
Sign Up
To create a free account, please fill out the form below.
Thank you for signing up!
A confirmation email has been sent to your email address. Please check your email and follow the instructions in the message to complete the registration process. If you do not receive the email, please check your spam folder or contact us for assistance.
Welcome to our platform!
Oops!
Something went wrong while trying to create your new account. Please try again and if the problem persist, Email Us to receive support.
Newell Brands Announces Agreement to Sell the Connected Home & Security Business to Resideo Technologies, Inc.
Rhea-AI Impact
(Neutral)
Rhea-AI Sentiment
(Positive)
Tags
Rhea-AI Summary
Newell Brands Inc. (NASDAQ: NWL) has entered into a definitive agreement to sell its Connected Home & Security (CH&S) business to Resideo Technologies, Inc. (NYSE: REZI) for expected gross proceeds of $593 million. The CH&S business, based in Aurora, Illinois, generated net sales of approximately $395 million in 2021 and is known for brands such as BRK and First Alert. The sale will enable Newell to focus on its core capabilities while using the after-tax proceeds for debt reduction and a $375 million share repurchase program. The transaction is expected to close by the end of Q1 2022.
Positive
Expected gross proceeds from the sale of CH&S business are $593 million.
Projected use of proceeds includes debt paydown and a $375 million share repurchase program.
Transaction allows Newell Brands to focus on areas with higher potential for value creation.
Negative
The divestiture may impact overall market share and brand presence in the home safety sector.
ATLANTA--(BUSINESS WIRE)--
Newell Brands Inc. (NASDAQ: NWL) announced today that it has signed a definitive agreement to sell the Connected Home & Security (CH&S) business to Resideo Technologies, Inc. (NYSE: REZI), a leading global provider of home comfort and security solutions and distributor of commercial and residential security and audio-visual products.
The CH&S business, based in Aurora, Illinois, is a leading manufacturer in the U.S. home safety market with strong positions in both retail and commercial channels. The business produces and distributes smoke and carbon monoxide combo alarms, fire suppressants, fireproof safes and other home safety products under the most trusted brands in the industry, BRK and First Alert, which help protect the lives, wellbeing and valuables of consumers. In 2021, net sales for the CH&S business were approximately $395 million.
Gross proceeds from the divestiture are expected to be $593 million, subject to customary working capital and transaction adjustments. The company anticipates using the after-tax proceeds of the transaction toward both debt paydown and share repurchase, with the goal of maintaining the company’s current leverage ratio. As such, Newell Brands’ Board of Directors has authorized a $375 million share repurchase program, effective immediately. The transaction is expected to have an approximately neutral impact on the company’s normalized earnings per share in 2022, considering the anticipated use of proceeds.
“We are confident that Resideo is the right strategic owner for CH&S, as they have a presence in more than 150 million homes, and we believe this transaction will allow the business to realize its full potential,” said Ravi Saligram, Newell Brands President and CEO. “At the same time, it enables the Newell Brands team to bring even greater focus to categories where we see the highest potential for value creation through our core capabilities.”
"The addition of First Alert to the Resideo portfolio provides a highly complementary extension of our existing sensor solutions in the home," commented Jay Geldmacher, Resideo CEO. "Not only does First Alert bring a leading brand and market position in home safety, but its products also occupy a highly strategic position on the ceiling.”
The transaction has been approved by the Board of Directors for each company and is expected to be completed by the end of the first quarter of 2022, subject to customary closing conditions, including regulatory approval. J.P. Morgan Securities LLC acted as a financial advisor to Newell Brands on the transaction.
About Newell Brands
Newell Brands (NASDAQ: NWL) is a leading global consumer goods company with a strong portfolio of well-known brands, including Rubbermaid, FoodSaver, Calphalon, Sistema, Sharpie, Paper Mate, Dymo, EXPO, Elmer’s, Yankee Candle, Graco, NUK, Rubbermaid Commercial Products, Spontex, Coleman, Campingaz, Contigo, Oster, Sunbeam and Mr. Coffee. Newell Brands' beloved, planet friendly brands enhance and brighten consumers lives at home and outside by creating moments of joy, building confidence and providing peace of mind.
This press release and additional information about Newell Brands are available on the company’s website, www.newellbrands.com.
About Resideo
Resideo is a leading global manufacturer and distributor of technology-driven products and solutions that provide comfort, security, energy efficiency and control to customers worldwide. Building on a 130-year heritage, Resideo has a presence in more than 150 million homes, with 15 million systems installed in homes each year. They continue to serve more than 110,000 professionals through leading distributors, including their ADI Global Distribution business, which exports to more than 100 countries from nearly 200 stocking locations around the world. For more information about Resideo, please visit www.resideo.com.
Forward-Looking Statements
This news release contains forward-looking information based on management's current views and assumptions, including statements regarding the expected benefits, use of proceeds, financial impact and timing of the CH&S divestiture. Actual events may differ materially. Factors that may affect actual results include, but are not limited to, whether and when the required regulatory approvals for the transaction will be obtained and other closing conditions satisfied and whether and when the transactions will close, as well as whether the company is able to execute the anticipated use of proceeds in a timely and effective manner. Please refer to the cautionary statements set forth in the "Forward-Looking Statements" section and under the caption “Risk Factors” in Newell Brands’ Annual Report on Form 10-K for other factors that could affect our business.
