🔒Newell tools integration, deal-making top Loree’s challenges

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It didn't take Jim Loree long to make a splash as the new president and CEO of New Britain-based Stanley Black & Decker Inc., a position he ascended to Aug. 1. Barely two months later he engineered plans to buy Newell Brands Inc.'s tool business for $1.95 billion.

The deal, announced Oct. 12, could close in the first quarter of 2017, Loree said, and integrating Newell tools and its Lenox and Irwin brands will be next year's No. 1 challenge.

But Loree, 58, at the company since 1999, is no stranger to big acquisitions, having participated in then-Stanley Works' $4.5 billion purchase of Black & Decker in 2010 when he was chief operating officer. He became president and COO in 2013 before replacing the retiring John Lundgren this year.

The Black & Decker integration team remains largely intact and the company will use the same integration methodology with Newell, Loree said, expecting good results “because the organization has good muscle memory.”

He called the Newell deal simpler than the Black & Decker purchase, which combined two equal-sized companies. Stanley Black & Decker, with revenues this year between $11 billion and $12 billion, is digesting a tools business with 2015 revenues of $790 million, “so it's a different scale … nonetheless, I never want to minimize the challenges associated with integrating acquisitions.”

Newell won't be Stanley's last buyout. Acquisitions will be necessary to reach the company's aim of doubling revenues by 2022.

Asked about a report the company was interested in Craftsman tools, which Sears Holdings wants to sell, Loree was vague.

“We're kind of covered by confidentiality in that regard,” he said. “However, Craftsman is one of America's great tool brands and in some ways we'd love to have that brand as part of our portfolio, but there are challenges associated with it that may or may not be insurmountable.”

Future acquisitions could include expansion of Stanley's core tools business, and additions in its industrial and security systems areas, Loree said.

The company can grow 4 to 6 percent a year organically through its focus on digitization, innovation and commercial excellence, he said.

“We really are focused on becoming one of the world's great innovators … and that will fuel our growth for years to come,” Loree said.

An example is its new DeWalt FlexVolt, a 60-volt battery system that can extend a 20-volt cordless tool's runtime by up to four times. It also can power miter saws and other tools that require more power and haven't been cordless before, he said. Two FlexVolts can power a 120-volt cordless power tool.

“It's an incredible innovation story because it was just a concept about two years ago,” he said.

Special teams also are working in business units to stay ahead digitally because industrial companies aren't immune from digital disruption, Loree said, adding the company's view is: “Let's disrupt ourselves before somebody disrupts us.”

Corporate social responsibility also is important to Stanley, which is infusing sustainability into all aspects of its design, manufacturing and distribution process and been recognized nationally for its progress, he said.

David MacGregor, a senior analyst at Longbow Research in Independence, Ohio, who follows Stanley, said in an email he expects a substantial new product roll out in 2017, featuring 60- and 120-volt tools, a higher-voltage area of the cordless power-tool category that's still relatively unpopulated. However, with the FlexVolt, growth in 60- and 120-volt tools will pull along battery sales and create a meaningful incremental earnings stream, he added.

MacGregor also expects Stanley's industrial business to benefit from another good year of new automotive sales. Also, Stanley's CRC-Evans subsidiary, focused on pipeline inspection/welding/maintenance, could benefit from “improving energy-sector business and an emerging pro-pipeline view in both Washington and Ottawa.”

As for Loree, he's a well-respected executive with a track record of delivering for shareholders, MacGregor wrote.

“Culturally, Jim's influence is already pervasive throughout the organization, so incremental improvements associated with his having taken over the CEO role will be more nuanced,” MacGregor said.

Loree has three daughters, 3, 4 and 20, and is married to Rebecca Kennedy Corbin Loree of Corbin Perception Group LLC. Their Jim and Rebecca Loree Foundation supports STEM education, schools like Grace Academy in Hartford, and the arts.

The drive to help the arts is intensified by Loree's concern as a business leader seeing GE pull its headquarters from Connecticut and the potential for others to follow, eroding the state's economic base, talent recruitment and arts support. Loree says he's involved with government leaders to help improve the state's business climate and is cautiously optimistic the state can right itself.

“It's not a sustainable model right now, and so that has to change,” Loree said. “That's why I think a business-government partnership could be good because I think the business leaders in the community would rally around a government that said, 'OK, we're going to address the structural fiscal problems once and for all from a cost point of view and you, businesses, you figure out how to bring the jobs in' — and that's the partnership,” he said.