Friday, May 16, 2008

Stanley Works tools up for RFID with Xmark buy

Power tool and construction supply maker The Stanley Works, based in New Britain, Conn., has paid $45 million in cash to acquire Canadian radio frequency identification (RFID) technology maker Xmark Corp., a wholly-owned subsidiary of Florida-based VeriChip Corp.

Xmark, which focuses on RFID products for tracking people and assets, boasts annual revenue of more than $30 million, according to Stanley Works' officials. Under terms of the deal, Xmark will operate as part of Stanley Works' (NYSE:SWK) security segment, which develops physical security systems for buildings, airports and institutions.

Xmark's products focus on three vertical markets: infant security under the Halo brand, wander protection systems for children under the Hugs brand, and hospital and asset tracking systems under the RoamAlert brand.

The deal is expected to help Stanley Works' security business provide a wider array of value-added products and services, according to Stanley Works chairman and CEO John Lundgren.

The acquisition is expected to be completed during the third quarter or early in the fourth quarter following an affirmative vote by a majority of VeriChip's (Nsadaq: CHIP) stockholders. The deal is expected to have little to no impact on Stanley Works' earnings and cash flows in 2008 and is expected to be nominally accretive to earnings and cash flows in 2009, according to the company.

The Stanley Works reported revenue of more than $4.7 billion in 2007 and is home to more than 20,000 employees. The company's security division includes products under the Stanley, Best, National, HSM and FatMax brands.