Access Control giant ASSA ABLOY announces it has signed a definitive agreement to acquire the Hardware and Home Improvement (HHI) division of Spectrum Brands (NYSE:SPB) for $4.3 billion on a cash and debt free basis. The deal unites four of the top five smart door locks brands for the professional installation channel under one roof.
The acquisition will bring together four of the five top brands in smart door locks category sold through the professional installation channel. Spectrum’s custom-focused brands include Kwikset and Baldwin, while ASSA Abloy’s brands include Yale and August among others.
In the 2021 CE Pro 100 Brand Analysis Study, Yale is used by 72% of integrators, followed by Kwikset at 64%. Baldwin is used by 27% and August has a 19% market share. The only top five brand not in the mix is Allegion’s Schlage brand, which is used by 41% of CE Pro 100 integration companies.
Spectrum Brands’ HHI division is a leading provider of security, plumbing and builders’ hardware products to the North American residential segment with a diversified product offering of locksets, faucets and builders’ hardware.
HHI has a varied portfolio of innovative products, including patented SmartKey technology and electronic, smart and biometric locks. Key brands include Kwikset, Baldwin, Weiser, Pfister and National Hardware.
Headquartered in Lake Forest, Calif. with some 7,500 employees worldwide, HHI has manufacturing facilities in the United States, Mexico, Taiwan, China and the Philippines.
For the fiscal year ending September 2020, HHI’s net sales were $1.34 billion with an adjusted EBITDA margin of around 19%.
“HHI is an excellent addition to the ASSA ABLOY Group and constitutes an important strategic step in developing our residential business in North America. This acquisition advances our strategy to strengthen our position by adding complementary products to the core business and it will further accelerate the transformation from mechanical to digital solutions,” says Nico Delvaux, president and CEO of ASSA ABLOY. “I look forward to welcoming HHI and all of its employees into the ASSA ABLOY Group.”
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ASSA ABLOY, which also owns one of the leading access control brands in HID, says it can bring technological innovation to consumers using HHI’s access to new retail channels, such as homebuilders and DIY retail, and that HHI’s large installed base and great consumer reputation provides an excellent opportunity to grow its electromechanical and digital access solutions.
“After stewarding this asset for the past decade, the board of directors and I are confident that ASSA ABLOY is uniquely positioned to take our HHI business and team members to the next level of performance and achievement. I am personally excited to see the innovation and exciting new products that this transaction will unlock for future generations,” says David M. Maura, executive chairman and CEO of Spectrum Brands Holdings Inc.
The transaction is conditional upon regulatory approval and customary closing conditions and is expected to close during the fourth quarter of 2021. HHI will become part of ASSA ABLOY’s Opening Solutions Americas Division.