Black & Decker 2011 Annual Report Download - page 5

solutions include video surveillance, access control,
intrusion alarms and fire alarm systems, and its oerings
include design and installation services, maintenance and
repair, and monitoring systems. The acquisition expands
and complements Stanley Black & Decker’s existing
security product oerings, and further diversifies the
Company’s operations and international presence. The
addition of Niscayah brings total pro forma Convergent
Security Solutions annual revenues to approximately $.
billion and the pro forma Security segment to $. billion,
roughly % of the entire Company.
We expect the transaction to result in annual cost savings
of approximately $ million — $  million of which is
expected to be realized by the end of . The acquisition
is also expected to be immediately accretive to Stanley
Black & Decker’s EPS, with accretion of $. in  and
$. by . Importantly, the acquisition was funded
with existing oshore cash resources, with no additional
debt or equity issuances, which means that $. billion of
nonproductive cash was put to work.
Since , when our journey to broader diversifica-
tion began, we have made more than  acquisitions
and cultivated a potent, proven and eective integration
process along the way that we deploy no matter what the
size or nature of the business being acquired. We believe
our ability to integrate companies successfully is a key
component to driving shareholder value and a competi-
tive advantage of Stanley Black & Decker. This being said,
having the management and personnel bandwidth to
REVENUE GROWTH IN 
+ %
Total Revenue Growth (Pro Forma)
+ %
Organic Revenue Growth (Pro Forma)
Stanley Black and Decker 2011 Annual Report
Niscayah acquisition continues
diversification strategy
Niscayah’s integrated security solutions include
video surveillance, access control, intrusion alarms
and fire alarm systems, and its oerings include
design and installation services, maintenance and
repair, and monitoring systems. The acquisition
expands and complements Stanley Black & Decker’s
existing security product and service oerings, and
further diversifies the Company’s operations and
international presence.
was encouraging, as close to % of the questions
surveyed were considered favorable or highly favorable,
and the responses from each legacy company were virtu-
ally identical. This feedback was particularly encouraging
because the soft issues of merging two cultures can often
undermine the success of a major acquisition. We are
pleased to report that, if anything, the cultural integration
has been a major positive for this transaction.
Niscayah
When we announced the combination with Black &
Decker, many of you asked how it made sense in light of
our long-standing strategy to diversify away from the U.S.
building products sector and expand upon our attrac-
tive growth platforms, in our journey to become a global
diversified industrial company. Our response was that
the old playbook remained the same and that the compel-
ling strategic and economic rationale behind the merger
would create a stronger, more valuable franchise, and the
powerful free cash flow of the combined Stanley Black &
Decker would enable us to achieve our goals of diversifica-
tion at a faster pace than as a standalone company. Our
acquisition of Niscayah is a case in point.
Niscayah, our largest acquisition within our Security
segment to date, which closed in September , is a
leading European commercial electronic security and
monitoring company we had pursued for over five years,
because of its strategic fit. Niscayah’s integrated security