Financially strapped Sears will sell its rights to its Craftsman brand to tool giant Stanley Black& Decker, to the buyer indicating that the move will add jobs in the U.S.
Stanley will gain the right to develop, manufacture and sell Craftsman-branded products in non-Sears Holdings retail, industrial and online sales channels across the U.S. and other countries.
Sears has expanded the brand’s presence to its Kmart stores as well as competitor Ace Hardware.
Sears Holdings will continue to offer Craftsman-branded products, sourced from existing suppliers, through its current retail channels via a perpetual license from Stanley Black& Decker, which will be royalty-free for the first 15 years after closing and royalty-bearing after that.
About 10 percent of Craftsman-branded products are sold outside of Sears Holdings and the agreement will enable Stanley Black& Decker to increase Craftsman sales in the untapped channels.
“Craftsman is a legendary, American brand with tremendous consumer awareness built on a legacy of producing quality products at a great value,” said Stanley Black& Decker CEO James M. Loree. “This agreement represents a significant opportunity to grow the market by increasing the availability of Craftsman products to consumers in previously underpenetrated channels. We intend to invest in the brand and rapidly increase sales through these new channels, including retail, industrial, mobile and online. To accommodate the future growth of Craftsman, we intend to expand our manufacturing footprint in the U.S. This will add jobs in the U.S., where we have increased our manufacturing headcount by 40% in the past three years.”
Sears Holdings’ CEO Edward S. Lampert stated, “We are pleased to reach this agreement, after determining that externalizing the Craftsman brand would accomplish our goals of driving value for Sears Holdings and positioning Craftsman for future growth.”
Lampert has been pumping his cash into Sears. Analysts believed Lampert could eventually profit from gradually closing underperforming Sears stores and profiting from real estate and other asset sales.
He has since embarked on unsuccessful strategies to turn around the retailer.
Sears earlier announced plans to close additional stores. No Delaware stores were affected by the announcement, although an affiliate company is shutting down a home furnishings store near Christiana Mall south of Newark.
