Stanley to buy Craftsman brand from Sears

Sears Holdings Corp. agreed to sell its Craftsman tool brand to Stanley Black and Decker Inc. for about $900 million, marking CEO Edward Lampert's third move in the last two weeks to prop up the beleaguered retailer with fresh sources of funding.

Under terms of the deal, New Britain, Conn.-based Stanley will pay $525 million at closing and $250 million after three years, the companies said in a statement Thursday. The buyer also will make annual payments on new Craftsman sales for 15 years.

Sears also announced plans to shutter 150 unprofitable stores in a bid to streamline the chain.

With Sears's department-store business continuing to bleed cash, Lampert has turned to selling and spinning off assets to keep the company operating. The hedge fund manager, who's also the retailer's chairman and largest investor, agreed earlier this week to lend the company $500 million and said last month that affiliates of his company would offer it a $200 million line of credit.

Sears also has been reviewing its DieHard batteries and Kenmore appliance brand for potential sales.

'Looking ahead, we will continue to take actions to adjust our capital structure, meet our financial obligations and manage our business to better position Sears Holdings to create long-term value,” Lampert said in Thursday's statement.

Craftsman has been part of Sears since 1927, when the retailer acquired the brand for $500. The tools debuted in the iconic Sears catalog two years later.

By the 1940s, the brand benefited from a surge in power-tool sales. In 1981, President Jimmy Carter was given a Craftsmen woodworking set as his farewell gift when he left the White House.

Sears will continue to carry Craftsman products at its stores. The license will be royalty-free for 15 years, and then generate 3 percent afterward.