Harvard Business School 9-389-005 rP os t September 15, 1988 Skil Corporation op yo On March 23, 1979, Emerson Electric Company acquired Skil Corporation, a manufacturer of portable power tools, for $58 million. With sales of $2.6 billion in 1979, Emerson Electric produced a broad range of electrical and electronic products and systems. Emerson Electric Company Emerson Electric, originally a manufacturer of electric motors and fans, had gradually expanded into a broad
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Organizational Transformation of Black & Decker Ishita Aditya 11BM60074 Black & Decker Corporation is a corporation based in Towson, Maryland, United States, that designs and imports power tools and accessories, hardware and home improvement products, and technology based fastening systems. In 1843, Frederick Stanley started a small shop in New Britain, Connecticut, to manufacture bolts, hinges, and other hardware from wrought iron. With superior quality
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Valuing Publicly Traded Equity Securities: The Black & Decker Corporation (BDK) [1] I. Introduction This teaching note describes the valuation of publicly traded equity securities using the Discounted Cash Flow (DCF) and Price/Characteristic (market comparison) approaches, with a specific spreadsheet example for The Black and Decker Corporation. Free cash flow valuation and comparables (comps) are key tools in fundamental analysis, the process of picking stocks with high expected return
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Skil Corporation On March 23, 1979, Emerson Electric Company acquired Skil Corporation, a manufacturer of portable power tools, for $58 million. With sales of $2.6 billion in 1979, Emerson Electric produced a broad range of electrical and electronic products and systems. Emerson Electric Company Emerson Electric, originally a manufacturer of electric motors and fans, had gradually expanded into a broad range of consumer and industrial products. It classified its businesses into commercial and industrial
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Black and DECKER: power tools Case study Problem Statement Black and Decker has established its brand strength to be among the top ten firms in the United States. By creating the portable power tools business in the early 1990’s and being the world’s largest producer by the end of the decade, the firm has been vouched for offering high quality, differentiated products and excellent service in the Professional-Industrial segment. Powerful brand perception has helped Black and Decker attain the
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professionals alike, followed by Contractor supply and Mill supply. Skil Corporation was acquired by Emerson Electric company in 1979 as part of the latter's growth strategy which is now faced with the challenge of increasing market share in an industry where growth is saturated and market share dominated by players such as Black & Decker and Sears. The Portable Power Tool Industry: Attractive or not? Black & Decker was the leader in this industry with 75% of its sales coming from power
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Skil Corporation The acquiring company Emerson had a strategy of producing low cost and high quality products. It started on a program of acquisitions to meets its aggressive goals of growing sales 15% annually. It had acquired only financially successful companies. But in 1979, it acquired Skil Corporation, a financially mediocre and low performing company for $58 million. Skil was a leading manufacturer of portable power tools serving the professional and consumer markets, the circular saw being
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Introduction: Black & Decker Corporation (B&D) is one of the top power tool producing companies in the world. The company targets three main segments: Consumers, Professional-Tradesman, and Professional-Industrial. By late 1990 B&D’s market share in the Tradesman segment fell dramatically causing its main competitor, Makita, to obtain 80% of the market share in cordless drills and 50% segment share overall. Although B&D has a respectable market share holding in its other two market segments, the
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1.1 Problem Statement: The problem faced by the Black and Decker Corporation (A) is the zero profitability faced by the company in its Power Tools Division’s especially in the ‘Tradesmen” segment. Out of the three segments in this Power Tools Division, B&D was facing immense competition from Makita Electric of Japan which had practically taken oven the professional power tools for tradesmen business since it entered the United States market a decade ago. According to the trade practices the company
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The Black & Decker Corporation Household Products Group: Brand Transition 1. How good or bad is the acquisition by Black and Decker? Evaluate the same. The main objective of the acquisition was: * To gain access to house ware buyers * Resolve to develop a family of products that could address wide spectrum of house wares Following were the reasons for Black & Decker acquiring GE House wares division: 1. Black and Decker (B & D) was having slower growth rate in
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