TOWSON, Md. (AP) -- Shareholders approved a nearly $3.5 billion stock buyout Friday, clearing the final hurdle for Stanley Works to acquire Black & Decker.
The two are set to form a new company called Stanley Black & Decker, and become the nation's largest toolmaker, at the end of business on Friday, according to regulatory filings submitted to the Securities and Exchange Commission.
The new Stanley Black & Decker will retain headquarters in New Britain, Conn., where Stanley Works is headquartered. Meanwhile, the company's power tool division will remain headquartered in Towson, Md., where Black & Decker operates.
Under the agreement, first announced in November, Black & Decker shareholders received stock valued at $57.57 for each share. Based on the company's 60.2 million shares outstanding July 24, the deal is worth $3.46 billion.
Stanley shareholders will own about 50.5 percent of the combined company, while Black & Decker shareholders will hold the rest.
Black & Decker has 22,100 workers while Stanley Works has 18,200. The companies hope their combination will produce at least $350 million in cost savings within three years, in part through an unspecified number of job cuts, and increase earnings per share by $1 within three years.
Earlier Friday, European regulators approved the deal and the Stanley Works' board of directors approved six board members of Black & Decker to join the new company's board. Black & Decker's current CEO Nolan D. Archibald will become chairman of the board after the acquisition.
Some outside observers questioned that move, along with Archibald's pay package, because of a business relationship between him and an independent board member. Some estimates put Archibald's pay package at nearly $90 million over three years.
The two men are involved in a real estate venture in Utah. The company said neither's actions related to the merger were influenced by that relationship.
Black & Decker shares fell 24 cents to 74.70 in midday trading while Stanley Works shares dipped 20 cents to $58.63.