Stanley Black & Decker offers $300 million three-year equity units at 6%-6.5%, up 17.5%-22.5%

By Rebecca Melvin

New York, Nov. 25 - Stanley Black & Decker Inc. launched an offering of $300 million of three-year mandatory equity units, or 3 million units at $100 each, before the market open Monday that were seen pricing after the close, according to a syndicate source.

The notes were talked to yield 6% to 6.5% with a premium of 17.5% to 22.5%.

The registered units, which consist of junior subordinated notes due 2018 and contracts to purchase common stock, are being sold via Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC as joint bookrunning managers.

Common stock is expected to be delivered upon settlement of the purchase contracts.

A portion of the proceeds is being used to purchase options on the company's common stock from counterparties, which may include some of the underwriters and their affiliates. The options are expected to offset dilution upon settlement of the purchase contracts if the company's share price exceeds the threshold appreciation price of the units.

Stanley Black & Decker is also offering $400 million of fixed-to-floating rate junior subordinated debentures due 2053. Completion of the two deals is not contingent on each other.

New Britain, Conn.-based Stanley Black & Decker is a provider of hand tools, power tools and related accessories.

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