Going ahead with its 'Growth Game Plan',
Newell Rubbermaid Inc.
) announced the sale of its hardware business to Nova Capital, an
expert buyer of corporate and private equity portfolios for $214
million, including accounts receivable.
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The after-tax proceeds are likely to be around $175 million. The
transaction (subject to customary conditions) is likely to close
in the third calendar quarter of 2013. Newell Rubbermaid
appointed Rothschild as the financial advisor in this business
The hardware business comprises four brands, namely Amerock,
Ashland, Bulldog and Shur-Line, which together are expected to
generate revenue of approximately $255 million for 2013.
In May 2013, Newell Rubbermaid had declared that it was looking
for prospective buyers to offload its Hardware and Teach Platform
businesses. According to the company, these businesses were not
in line with its 'Growth Game Plan' strategy as announced in Oct
2012. Under the particular strategy, the company intends to
eliminate approximately 10% of the workforce, build a new
organizational model as well as leadership team.
In Jul 2013, Newell Rubbermaid sold out its Teach Platform
business to a Beverly Hills, Calif. based private equity firm,
Skyview Capital, LLC. Newell's Teach Platform business includes
the Mimio and Headsprout interactive teaching technology brands.
The company has not disclosed the terms of the deal.
We believe that the recently concluded transaction will enable
Newell Rubbermaid to build an organized portfolio in the existing
five fundamental business segments, namely Home Solutions,
Writing, Tools, Commercial Products and Baby & Parenting.
Consequently, it will provide ample prospects to grow through
innovation, brand augmentation and by garnering opportunities in
We believe that the overall growth plan will help Newell
Rubbermaid to reduce the complexities of the organization, boost
efficiencies in customer services and sourcing functions as well
as increase investments in the core business areas. The long-term
growth plan, which is expected to be fully implemented by the end
of second-quarter fiscal 2015, will save approximately $180-$225
Newell Rubbermaid currently carries a Zacks Rank #3 (Hold). Other
well performing stocks include
Jack in the Box Inc.
Green Mountain Coffee Roasters, Inc.
). All of them carry a Zacks Rank #1 (Strong Buy).