Assa Abloy AB said it will sell its Yale and Emtek lock brands, and U.S. and Canada residential businesses to Fortune Brands Home & Security in an $800 million all-cash deal, as it seeks to overturn U.S. antitrust opposition to its purchase of a unit of Spectrum.
Earlier this year, the U.S. Justice Department had sued to block a $4.3-billion proposed deal by Assa Abloy, the world’s No.1 lock maker, to buy the hardware and home improvement (HHI) division of Spectrum Brands Holdings Inc that makes residential door hardware, as the deal signed last year, could lead to higher prices.
Reuters had reported in October that Assa Abloy was working to sell its Emtek and smart residential business in the United States to resolve U.S. antitrust issues that are holding up a planned acquisition.
“While keeping these residential businesses in the U.S. and Canada would have been preferred, we are confident that we have now fully eliminated all competitive concerns alleged by the DOJ and that the acquisition of HHI is in the long-term interest of our shareholders,” Assa Abloy President and Chief Executive Officer Nico Delvaux said in a statement on Friday.
Assa Abloy said the residential businesses outside of the United States and Canada are not in scope to be divested.
“The sale of these strong businesses… will fully and completely resolve any conceivable competitive concerns and will further benefit consumers by enabling Fortune Brands to bring even stronger competition to all segments of the residential security market,” Spectrum said in a separate statement.
Source: Reuters.com