Shares of Stanley Black & Decker (SWK) were climbing sharply in midafternoon trading Wednesday after the household hardware provider announced it will buy Newell Brands' (NWL) tool businesses for $1.95 billion in an all-cash deal.
The deal will give New Britain, Conn.-based Stanley Black & Decker the Irwin, Hilmor and Lenox brands that comprise Newell Tools, which have reported sales of about $760 million over the past 12 months. Sales have been growing at a "low- to mid-single-digit" annual rate since 2011, Stanley Black & Decker said in a Wednesday statement. Shares of Newell Brands were also climbing in afternoon trading. (Newell Brand shares are held in Jim Cramer's Action Alerts PLUS charitable trust.)
"This transaction, with our multifaceted approach to revenue expansion, is entirely consistent with our strategy of driving above-market growth in a low-growth world," Stanley Black & Decker CEO James Loree said of the deal, which is subject to regulatory approval and slated to close in the first half of next year.
Meanwhile, shareholders fled health insurance giant Humana (HUM) in droves Wednesday after the company unveiled that membership fell by about 1.17 million across its top insurance offerings, which are rated four stars or higher by Medicare Star Quality Ratings. This represents a dip of about 37% year over year.
"The company believes that the decline is primarily attributable to the impact of lower scores for certain Stars measures as a result of the company's recently closed comprehensive program audit by the Centers for Medicare and Medicaid Services," the company said in a statement.