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[Spike Spiegel]

http://www.wsj.com/articles/sears-sells-craftsman-brand-to-stanley-black-decker-1483623215

Sears Sells Craftsman Brand, to Close 150 Stores
The cash-strapped retailer will sell its iconic Craftsman brand to Stanley for about $900 million

By Anne Steele

Sears Holdings Corp. said it would close another 150 stores and sell its Craftsman tool brand for $900 million, as the cash-strapped retailer continues to shrink and battle slumping sales.

Sears is flipping the Craftsman brand to Stanley Black & Decker Inc., and it will license back the ability to sell Craftsman-branded products royalty-free for 15 years after the deal's closing. The acquisition gives Stanley the rights to develop, manufacture and sell Craftsman-branded products outside of Sears.

At present, just 10% of Craftsman-branded products are sold outside of Sears. Stanley Black & Decker said the deal will help boost Craftsman sales in untapped channels.

”We intend to invest in the brand and rapidly increase sales through these new channels, including retail, industrial, mobile and online," said Stanley Black & Decker Chief Executive James Loree. Stanley also recently signed a $1.95 billion deal to buy Newell Brands Inc.'s tools business.

A Sears spokesman confirmed the unlimited lifetime warranty on Craftsman hand tools made in the U.S.—”a hallmark of the brand for generations"—will be kept in place.
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On Wednesday, Sears announced sweeping closures of 150 of its namesake and Kmart stores—which it called ”a difficult but necessary step as we take actions to strengthen the company's operations and fund its transformation."

http://www.nytimes.com/2017/01/05/business/dealbook/sears-craftsman-retailing.html?_r=0

Sears Agrees to Sell Craftsman Brand in a Bid to Raise Cash

By Michael J. de la Merced
Jan. 5, 2017

At a tough time for Sears Holdings, the beleaguered retailer has collected some much-needed cash — by selling one of its most beloved brands.

The company said on Thursday that it had sold its Craftsman line of tools to Stanley Black & Decker for at least $775 million, part of an effort to raise cash as it continues to grapple with troubles in its business.

For Sears, selling one of its classic brands — one it created nearly a century ago — is the latest move to bolster its balance sheet during a prolonged sales slump. The company's chairman and chief executive, Edward S. Lampert, has struggled for years with ways to help the company, as much through esoteric financial maneuvers as through operational fixes.

The company said on Thursday that comparable-store sales at its Sears and Kmart units for November and December were down at least 12 percent.

That kind of poor performance has battered Sears's financial health. As of Oct. 29, the retailer said that it had $258 million in cash and equivalents on hand, compared with $3.1 billion in long-term debt. Its market value on Thursday morning, by point of comparison, stood at $1.2 billion even after a jump in its stock price after the Craftsman news.

On Thursday, Sears listed its latest initiatives aimed at shoring up its cash position, from closing 150 more stores to raising up to $1 billion through both a $500 million loan backed by its real estate and a previously announced loan from Mr. Lampert's hedge fund.

[...]

Under the terms of the deal, Stanley Black & Decker will pay $525 million when the deal closes and an additional $250 million at the end of the third year after closing. Sears will also collect a percentage of new Craftsman sales for 15 years after the deal closes. All told, the transaction is now valued at about $900 million.

Sears will continue to sell Craftsman products in its stores under a licensing agreement that is free for the first 15 years. After that, the chain will pay Stanley Black & Decker a 3 percent fee.

The deal is expected to close by the end of the year.

And Stanley gobbles up another competitor to expand its influence over the tool world.

EDIT: Here's the list of 150 Sears and Kmart stores that will be closing.

http://www.usatoday.com/story/money/2017/01/05/sears-kmart-stores-closing/96195504/

 

[TheOMan]

Ooooh - I don't like this development.

 

[HStallion]

I was wondering what was going to happen to Craftsmen Brand tools if Sears went other.

 

[Ray Down]

Sears just slowly dying.

 

[johnny956]

Lampert has done absolutely nothing to turn around Kmart/Sears. Selling off brands. I guess he got his numbers out of the company when he bought them and is just milking them dry now before they close in a decade (probably 5 years actually)

 

[captive]

today i learned crafstman was owned by sears.

 

[Khalifa Jayy]

But that was their only redeeming quality... ?

 

[Culex]

Shame. My family has used their products for years. My father in law gave me his 20 year old impact gun, still works like new!

 

[rrs]

I wonder if the brand will have the value promptly scuttled with the warranty zapped and quality reduced to high end harbor freight

Lampert has done absolutely nothing to turn around Kmart/Sears. Selling off brands. I guess he got his numbers out of the company when he bought them and is just milking them dry now before they close in a decade (probably 5 years actually)

yeah, the company is just getting gutted and he'll be outta there with millions when there's nothing left to chop

 

[harSon]

Sears going out of business really bums me out. I don't shop there, and neither does anyone else, so it's always the parking lot I go to in malls to find guaranteed hassle free parking. Even during the Holidays.

 

[vainya]

But that was their only redeeming quality... ?

That and their Kenmore brand. I expect that will be sold too when they close and liquidate.

I went to target and saw a Black & Decker microwave. Had no idea that brand still existed. Seems like they own everything now.

 

[Muppet of a Man]

But that was their only redeeming quality... ?

Exactly. Sears is actually now totally valueless, as their Kenmore brand is really just repackaged Whirlpool products.

 

[Sobriquet]

Great. The one good thing about Sears.

 

[Madness]

Was inevitable. The CEO's will get nice bonuses as well for their work. Craftsman was a decent brand. Stanley is just dominating the tool market now. So many brands they control now.

 

[Frozenprince]

They are just trying to stretch out out. The tone to try and modernize and fix the business was a decade ago. Now it's too late. Just a long, painful death awaits.

 

[Laekon]

I don't understand why they just didn't start selling the brand themselves at Home Depot and Lowes. It has amazing brand value. If they needed the cash that badly then they really are dead. Feel sorry for all the small towns and workers that depend on them. Never figured out how stores like them and Macy's couldn't transition to more modern retail approaches.

 

[Cels]

today i learned crafstman was owned by sears.

surprised by this, considering that you can basically only buy craftsman at sears

 

[NealMcCauley]

One of the store closings is in my hometown mall. That place has been dying for a decade and this will probably be the final nail in the coffin.

No more.

 

[captive]

surprised by this, considering that you can basically only buy craftsman at sears

yea, probably why i dont own any craftsman tools. I never shop at sears.

 

[Ray Wonder]

surprised by this, considering that you can basically only buy craftsman at sears

You can't get craftsman at walmart or home depot??

Swear I have craftsman stuff, but haven't been to a sears in literally years.

 

[ThreePiMatt]

Yeah, Craftsman and Kenmore have been the only Sears-related brands that have any meaning these days and you can't run a department store entirely off of tools and appliances. That's like 1/5 of the store, at most. Walking into the Sears by me is an entirely depressing experience, lots of bare shelves and nearly devoid of other customers.

I have to imagine the store near me will close down, but I wonder what will take its place. Its attached to a mall and is a huge space (and has an attached Sears auto repair dept).

 

[mightynine]

I think when Sears and Kmart became one, Craftsman started showing up at Kmart (like Kenmore).

It's crazy how that guy is just bleeding Sears Holdings dry. Guess the hope they would flip all that real estate is gone so it's just get as much out of it and then shut it down.

 

[perfectchaos007]

They are just trying to stretch out out. The tone to try and modernize and fix the business was a decade ago. Now it's too late. Just a long, painful death awaits.

Yeah at least Radio Shack attempted (and failed) to modernize. Sears didn't do much at all. Radio Shacks still may be end up lasting longer than Sears lol

 

[bjork]

I bought Royal Rumble for Genesis at a Sears. $10.

They should be allowed to stay open forever because of that.

 

[biggersmaller]

Welp.

That elimates the remaining reason why 50+ men visited Sears.

$900 million...they're on life support more than ever.

 

[Spike Spiegel]

You can't get craftsman at walmart or home depot??

Swear I have craftsman stuff, but haven't been to a sears in literally years.

A few years back, Sears partnered with Ace Hardware to sell some of its Craftsman products through their retailers, but they've never gone into other home improvement stores... until now.

Expect Stanley to rebrand its own tools with the Craftsman logo and sell them everywhere under the sun.

 

[canoli2006]

Sad. I used to work in the Funtronics section around '98-'99. Top sellers were Ocarina of Time, Game Boy color was newly released, and PlayStation began its dual shock line of consoles.

 

[Ekai]

The Sears near me always seem super busy but I imagine the company as a whole is not doing very well right now.

 

[Tom Nook]

Sad

Nice way to start 2017....

 

[itwasTuesday]

A Sears spokesman confirmed the unlimited lifetime warranty on Craftsman hand tools made in the U.S.—”a hallmark of the brand for generations"—will be kept in place.

okay.

 

[Flying Toaster]

Wow... Craftsman was a decent brand and the warranty was amazing. Truly and end of an era. Death of Sears and Macys closing stores left and right just shows the impact of the internet over brick and mortar stores.

I am aware many of these companies are poorly run but it is quite something to see them still attempt to live.

 

[HariKari]

Craftsman has been shit for years. Not a secret that they've gone way, way down in quality.

 

[ColdPizza]

Sears just slowly dying.

Sounds like this will speed up the process hugely. This was the last and only reason I would have shopped there anymore.

 

[immortald3ath]

Well that sucks. My 21 year old Craftsman lawnmower is still running great.

 

[mollipen]

EDIT: Here's the list of 150 Sears and Kmart stores that will be closing.

http://www.usatoday.com/story/money/2017/01/05/sears-kmart-stores-closing/96195504/

Thankfully, our local Kmart isn't on the chopping block (at least for now). And I was happy to see that none of the ones back home (Omaha, NE) were on the list, but looking at Google Maps, it seems that's because all but one have already been killed in recent years.

I'll really miss Kmart, even though I know a lot of people won't. Though, one of their biggest strengths for me—the fantastic clearance deals they often had on video games—is now but a memory.

Also, something something the internet was a mistake.

 

[ReAxion]

bring back homes!

the list of kmarts closing in california is spectacularly unsurprising.

 

[dionysus]

If any legacy company should have been able to handle the transition to online buying you would think mail order catalogue companies would have done well. Sears though had too big a retail presence.

Yet I can't think of one that has done really well. Maybe the outdoor apparel ones like LL Bean and REI.

 

[LegalEagleMike]

They just announced the Sears in my town was closing. Which prompted everyone I know to say "Sears was still open?"

 

[peteykirch]

I was shocked when my GF and I went into Sears, and they had a guy in there peddling Sears Vacations.

Talk about trying to do too much, and just failing at everything.

 

[Ferrio]

We somehow have a Sears in our small town, there's maybe 3 cars in the lot ever at one time. I don't know how the place stays open. Whenever I go into I get that same dread as I do when walking into a Radio Shack.

 

[TangoAlphaLima]

This is my favorite part:

Sears is flipping the Craftsman brand to Stanley Black & Decker Inc., and it will license back the ability to sell Craftsman-branded products royalty-free for 15 years after the deal’s closing.

It's like Sears knows they've got less than 15 years left to live.

 

[Breads]

Amazon is cool but I feel like kids these days are being robbed of the mall experience.

 

[balladofwindfishes]

If any legacy company should have been able to handle the transition to online buying you would think mail order catalogue companies would have done well. Sears though had too big a retail presence.

Yet I can't think of one that has done really well. Maybe the outdoor apparel ones like LL Bean and REI.

Catalogs were the future of shopping, and one of the kings of catalogs just wasn't able to actually adapt to that, which is kind of ironic. Sears had the infrastructure for a huge mail order operation. It seems like it wouldn't have been hard to transition that into online catalogs and they could have been one of the first big online retailers. But, like many companies, they just didn't have the forward thinking ability to do that.

 

[AndyD]

today i learned crafstman was owned by sears.

It's their store brand. Was.

Their tools had been going down hill for a while already though.

 

[Dishwalla]

Sears/Kmart isn't going to be around much longer. I know we've been saying it for years, but I really think within a couple years we'll be hearing about the two brands disappearing for good.

 

[e_i]

They just announced the Sears in my town was closing. Which prompted everyone I know to say "Sears was still open?"

Yeah, I know. The Sears near me has nobody in it. I can imagine that people could walk in, steal half the stuff in the store and nobody would care enough to stop them.

 

[HStallion]

Catalogs were the future of shopping, and one of the kings of catalogs just wasn't able to actually adapt to that, which is kind of ironic. Sears had the infrastructure for a huge mail order operation. It seems like it wouldn't have been hard to transition that into online catalogs and they could have been one of the first big online retailers. But, like many companies, they just didn't have the forward thinking ability to do that.

This basically. None of them had the forethought to jump on the internet train soon enough and by the time they were most likely trying places like Amazon and other online retailers had already become established.

 

[LiK]

When's the last time anyone here went to Sears and bought something.

 

[dionysus]

Catalogs were the future of shopping, and one of the kings of catalogs just wasn't able to actually adapt to that, which is kind of ironic. Sears had the infrastructure for a huge mail order operation. It seems like it wouldn't have been hard to transition that into online catalogs and they could have been one of the first big online retailers. But, like many companies, they just didn't have the forward thinking ability to do that.

That is my point. The catalogue companies just had to build a website and advertise it to compete. But pretty much they all got beat out by new companies starting from scratch that had to build a distribution network from ground up.

But I dispute your timeline. Catalogue companies dominated for a while, then came strip malls and malls and catalogue declined (hence why Sears went so big into malls away from catalogue), then came internet and malls and retail is declining

 

[Duane Cunningham]

When's the last time anyone here went to Sears and bought something.

Personally, the only time I have in years is to occasionally get a Craftsman wrench.