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Spectrum Brands Holdings Completes Acquisition of Stanley Black & Decker’s Hardware & Home Improvement Group



  Spectrum Brands Holdings Completes Acquisition of Stanley Black & Decker’s
  Hardware & Home Improvement Group

Business Wire

MADISON, Wis. -- December 17, 2012

Spectrum Brands Holdings, Inc. (NYSE: SPB), a global consumer products company
with market-leading brands, announced today that it has completed the
acquisition of the Hardware & Home Improvement Group (HHI) of Stanley Black &
Decker, Inc. (NYSE: SWK) for $1.4 billion in cash. A definitive agreement to
acquire HHI was announced on October 9.

HHI is a major manufacturer and supplier of residential locksets, residential
builders’ hardware and faucets with #1 positions in key North American markets
and a portfolio of renowned brands, including Kwikset, Weiser, Baldwin,
National Hardware, Stanley, FANAL, Pfister and EZSET. HHI is a leader in its
key markets with #1 positions in U.S. residential locksets (Kwikset), Canada
residential locksets (Weiser), U.S. luxury locksets (Baldwin), and U.S.
builders’ hardware (Stanley/National Hardware), and a top 5 position in U.S.
faucets (Pfister).

“We are pleased to have closed on our HHI acquisition, and with attractive
debt financing, before the end of 2012, as we had originally anticipated,”
said Dave Lumley, Chief Executive Officer of Spectrum Brands Holdings. “We
welcome HHI to the Spectrum Brands family as a fourth operating segment that
will enhance our top-line growth, margins and free cash flow profile. HHI
brings us scale and greater product diversity, more balance in our sales
profile, stronger relationships with core retail partners, attractive
cross-selling opportunities in all channels, and a new platform for
significant future global growth using Spectrum Brands’ existing international
infrastructure, most notably in Europe.”

“HHI has compelling growth opportunities here and abroad,” Mr. Lumley said.
“The business is well positioned, from a cost, product line and market share
standpoint, to benefit from the U.S. housing market recovery as well as the
emerging home automation markets and the showroom and hospitality markets from
its significant investments in game-changing, patented innovations such as its
Smart Key re-keyable lockset technology and Smart Code Home Connect products
that have already delivered market share growth. In addition, by leveraging
Spectrum Brands’ large U.S. merchandising team capabilities, HHI will be able
to increase its in-store presence with customers. We believe HHI has a bright
future as part of Spectrum Brands, and look forward to supporting its product
development and growth initiatives to fully realize HHI’s potential.”

HHI generated net sales of approximately $985 million and adjusted EBITDA of
$188 million for the 12 months ended June 30, 2012.^1 Approximately 85 percent
of HHI’s annual revenues are generated in North America, with more than 40
percent coming through U.S. home improvement centers.

The HHI acquisition is expected to increase Spectrum Brands’ top-line growth
and margins, and to be immediately accretive to EPS, EBITDA and free cash flow
before synergies. EPS accretion pro forma for a full year of results is
expected to be between $0.75 to $0.80 per share in fiscal 2013 and EPS
accretion in fiscal 2014 is expected to exceed $1.00 per share, excluding
one-time transaction and integration costs and including synergies. The
acquisition also is expected to add more than an incremental $90 million of
free cash flow in the first two years after closing.

The acquisition of HHI also includes certain assets of Tong Lung Metal
Industry Co. Ltd. (“Tong Lung”), a Taiwanese manufacturer of residential and
commercial locksets with facilities in Taiwan and the Philippines. The Tong
Lung manufacturing assets will provide expanded sales platform capabilities,
allowing for accelerated expansion in international markets. The acquisition
of the Tong Lung assets is expected to occur during Spectrum Brands’ second
quarter of fiscal 2013 ending March 31, 2013. $100 million of the $1.4 billion
cash purchase price, which was adjusted for net debt and working capital, has
been held in escrow until the subsequent closing of the Tong Lung portion of
the HHI acquisition.

HHI will operate as a separate reporting segment within Spectrum Brands and be
managed by Greg Gluchowski, President of HHI. He reports to Spectrum Brands
CEO David Lumley and continues to oversee a highly experienced HHI management
team with an average of 20-plus years of experience and a proven track record
of innovation, operational excellence and profitable growth.

About Spectrum Brands Holdings, Inc.

Spectrum Brands Holdings, Inc., a member of the Russell 2000 Index, is a
global and diversified consumer products company and a leading supplier of
batteries, shaving and grooming products, personal care products, small
household appliances, specialty pet supplies, lawn & garden and home pest
control products, personal insect repellents and portable lighting. Helping to
meet the needs of consumers worldwide, the Company offers a broad portfolio of
market-leading, well-known and widely trusted brands including Rayovac®,
Remington®, Varta®, George Foreman®, Black & Decker®, Toastmaster®,
Farberware®, Tetra®, Marineland®, Nature’s Miracle®, Dingo®, 8-in-1®,
FURminator®, Littermaid®, Spectracide®, Cutter®, Repel®, Hot Shot® and Black
Flag®. Spectrum Brands Holdings' products are sold by the world's top 25
retailers and are available in more than one million stores in approximately
140 countries. Spectrum Brands Holdings generated net sales of approximately
$3.25 billion in fiscal 2012. For more information, visit
www.spectrumbrands.com.

Forward-Looking Statements

Certain matters discussed in this news release and other oral and written
statements by representatives of the Company regarding the HHI acquisition and
matters such as expected sales, adjusted EBITDA, other measures of financial
performance, and the financial impact of other acquisitions may be
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995.

These statements are subject to a number of risks and uncertainties that could
cause results to differ materially from those anticipated as of the date of
this release. Actual results may differ materially as a result of (1) Spectrum
Brands Holdings' ability to manage and otherwise comply with its covenants
with respect to its significant outstanding indebtedness, (2) our ability to
integrate, and to realize synergies from, the combined businesses of Spectrum
Brands and HHI, and from our purchase of 56 percent of the equity of Shaser,
Inc., and from other bolt-on acquisitions, (3) risks related to changes and
developments in external competitive market factors, such as introduction of
new product features or technological developments, development of new
competitors or competitive brands or competitive promotional activity or
spending, (4) changes in consumer demand for the various types of products
Spectrum Brands Holdings offers, (5) unfavorable developments in the global
credit markets, (6) the impact of overall economic conditions on consumer
spending, (7) fluctuations in commodities prices, the costs or availability of
raw materials or terms and conditions available from suppliers, (8) changes in
the general economic conditions in countries and regions where Spectrum Brands
Holdings does business, such as stock market prices, interest rates, currency
exchange rates, inflation and consumer spending, (9) Spectrum Brands Holdings'
ability to successfully implement manufacturing, distribution and other cost
efficiencies and to continue to benefit from its cost-cutting initiatives,
(10) Spectrum Brands Holdings' ability to identify, develop and retain key
employees, (11) unfavorable weather conditions and various other risks and
uncertainties, including those discussed herein and those set forth in
Spectrum Brands Holdings' and Spectrum Brands' securities filings, including
the most recently filed Annual Report on Form 10-K for Spectrum Brands, Inc.
or Quarterly Reports on Form 10-Q. Spectrum Brands Holdings also cautions the
reader that its estimates of trends, market share, retail consumption of its
products and reasons for changes in such consumption are based solely on
limited data available to Spectrum Brands Holdings and management's reasonable
assumptions about market conditions, and consequently may be inaccurate, or
may not reflect significant segments of the retail market.

Spectrum Brands Holdings also cautions the reader that undue reliance should
not be placed on any forward-looking statements, which speak only as of the
date of this release. Spectrum Brands Holdings undertakes no duty or
responsibility to update any of these forward-looking statements to reflect
events or circumstances after the date of this report or to reflect actual
outcomes.

Non-GAAP Measurements

Management believes that certain non-GAAP financial measures may be useful in
certain instances to provide additional meaningful comparisons between current
results for the Company, current results for HHI, and current results on a
pro-forma basis of the combined operations of the Company and HHI. Within this
release, including the tables attached hereto, reference is made to adjusted
earnings before interest, taxes, depreciation and amortization (Adjusted
EBITDA). See attached Table A, “Reconciliation of GAAP Net Income (Loss) to
Adjusted EBITDA,” for a reconciliation of GAAP Net Income (Loss) to adjusted
EBITDA. Adjusted EBITDA is a metric used by management and frequently used by
the financial community which provides insight into an organization’s
operating trends and facilitates comparisons between peer companies, since
interest, taxes, depreciation and amortization can differ greatly between
organizations as a result of differing capital structures and tax strategies.
Adjusted EBITDA also can be a useful measure of a company’s ability to service
debt and is one of the measures used for determining the Company’s debt
covenant compliance. Adjusted EBITDA excludes certain items that are unusual
in nature or not comparable from period to period. The Company provides this
information to investors to assist in comparisons of past, present and future
operating results and to assist in highlighting the results of on-going
operations. While the Company’s management believes that non-GAAP measurements
are useful supplemental information, such adjusted results are not intended to
replace the Company’s GAAP financial results and should be read in conjunction
with those GAAP results.

Table A: Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA

                                   LTM June 30,                      LTM June
                                   2012           YE Dec. 31, 2011   30,
                                                                     2012
                                   HHI (excl.                        HHI (inc.
                                   Tong           Tong Lung          Tong
                                   Lung)                             Lung)
Net Income (loss)                        41       $     5            $    45
      Income tax expense                 14             1                 15
      Interest expense                   37             -                 37
      Restructuring and related          24             -                 24
      charges
      Acquisition and
      integration related                -              -                 -
      charges
      Intangible asset                   -              -                 -
      impairment
      Other                              22             (1    )           21
Adjusted EBIT                      $     139      $     5            $    143
      Depreciation and                   42             2                 44
      amortization
Adjusted EBITDA                          181      $     7            $    188
                                                                      
                                                                      
Sales                              $     939      $     46           $    985

^1 Includes results of Tong Lung Metal Industry Co. Ltd. for the 12-months
ended 12/31/2011.

Note: Figures calculated prior to rounding.

Contact:

Investor/Media Contact:
Spectrum Brands, Inc.
Dave Prichard, 608.278.6141
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