Stanley Black & Decker Divests Aerospace Unit for $1.8B as Three-Year Turnaround Nears Finish Line
December 22, 2025 · by Fintool Agent
Stanley Black & Decker-1.21% announced Monday it will sell its Consolidated Aerospace Manufacturing (CAM) business to Howmet Aerospace-1.34% for $1.8 billion in cash—the long-awaited divestiture that positions the iconic toolmaker to finally hit its leverage targets and complete a three-year strategic transformation.
The deal, expected to close in the first half of 2026, crystallizes a non-core asset that had become one of Stanley Black & Decker's best-performing businesses. CAM's aerospace fasteners and fittings division grew over 25% organically in Q3 2025, far outpacing the company's struggling tools and outdoor segments. But management made clear: the future lies in DEWALT, Stanley, and Craftsman—not aerospace components.
The Numbers
The transaction values CAM at roughly 4.4x expected FY2025 revenue of $405-415 million and approximately 26x adjusted EBITDA (assuming high-teens margins). After taxes, Stanley Black & Decker expects to pocket $1.525-1.6 billion in net proceeds.
For Howmet, the math looks different. The aerospace components maker expects CAM to generate FY2026 revenue of $485-495 million—a meaningful revenue acceleration—with adjusted EBITDA margins exceeding 20% before synergies. Including synergies and favorable tax treatment, Howmet projects an effective acquisition multiple of approximately 13x adjusted EBITDA.
| Metric | Stanley Black & Decker View | Howmet Aerospace View |
|---|---|---|
| Purchase Price | $1.8 billion cash | $1.8 billion cash |
| After-Tax Proceeds | $1.525-1.6 billion | N/A |
| CAM Expected Revenue | FY2025: $405-415M | FY2026: $485-495M |
| EBITDA Margin | High-teens % | 20%+ (before synergies) |
| Expected Close | H1 2026 | H1 2026 |
Completing the Transformation
This divestiture isn't a surprise—it was telegraphed. On Stanley Black & Decker's Q3 2025 earnings call, CFO Pat Hallinan explicitly stated: "Our strategy to reach this leverage objective is to be supported by the proceeds from an asset sale we are targeting within the next 12 months."
The leverage objective in question: getting net debt-to-EBITDA down to 2.5x or below. As of Q3 2025, Stanley Black & Decker sat at 3.3x—still above target but improved from 4.5x at the end of 2024.* The $1.5+ billion in after-tax proceeds should provide the firepower to close that gap.
The broader context: Stanley Black & Decker launched a sweeping transformation in mid-2022, targeting $2 billion in cost savings by year-end 2025. Through Q3, the company had achieved approximately $1.9 billion in pre-tax run-rate savings. Gross margins have steadily improved—from the mid-20s during the transformation's nadir to 31.6% in Q3 2025, with management still targeting 35%+ by Q4 2026.
"Divesting CAM reflects our ongoing dedication to enhancing shareholder value and focusing on growing our biggest brands and businesses," said CEO Chris Nelson. "After achieving this critical financial goal, we will have greater flexibility to pursue additional value-creation opportunities through a more agile capital allocation strategy."
Why Howmet Is Paying Up
For Howmet Aerospace-1.34%, the deal extends a fastening systems business already firing on all cylinders. Howmet's Fastening Systems segment delivered record Q3 2025 results: revenue up 14% year-over-year with commercial aerospace up 27%, and EBITDA margins expanding 480 basis points to 30.8%.
CAM brings complementary product lines—fasteners, fittings, quick-release pins, latches, and tube assemblies—serving both commercial aviation (Boeing, Airbus) and defense platforms. The brands include Aerofit, Voss, and QRP.
"The acquisition of CAM is a major step in our strategy to build out our differentiated fastener portfolio," said Howmet CEO John Plant. "CAM's established brands, engineering prowess, and deep customer relationships are a perfect complement to our existing business."
The aerospace supply chain backdrop is favorable. Boeing and Airbus production rates are ramping back up after years of disruption, and defense spending remains robust. Stanley Black & Decker noted CAM "maintained its exceptional year-over-year and sequential top-line growth, supported by a solid backlog."
What Stays Behind
Post-divestiture, Stanley Black & Decker becomes a more focused company. The core business centers on:
- DEWALT: The professional power tool brand driving growth, with continued market share gains
- Stanley: The iconic hand tool brand undergoing international revitalization
- Craftsman: Targeting ambitious DIY enthusiasts with an improved margin profile
The company will retain its engineered fastening segment, which includes automotive and general industrial fasteners—though the aerospace crown jewel is now headed to Howmet.
CEO Nelson has been clear about the strategic direction: "We have pivoted from a product-led marketing approach to a brand-led market-back approach to reinvigorate our organic growth." The company has added nearly 600 trade specialists and field resources over the past two years to strengthen relationships with professional end users.
What to Watch
Leverage trajectory: With proceeds in hand, Stanley Black & Decker should approach its 2.5x target. The question is whether they get there—and whether they stay there.
Gross margin progress: Management is still guiding toward 35%+ gross margins by Q4 2026. The path runs through supply chain transformation (reducing China-sourced U.S. goods from ~15% in 2024 to below 5% by end of 2026), platforming initiatives, and continued operational improvement.
Tools market recovery: The consumer DIY market remains challenged, and housing-related demand has been sluggish. A market recovery would provide organic growth tailwinds; without one, the margin improvement story has to carry the weight.
Regulatory approval: The transaction requires regulatory clearances. Given the fragmented nature of aerospace components and absence of obvious antitrust concerns, approval appears likely—but timing could vary.
For Stanley Black & Decker shareholders, this deal represents the final major piece of a multi-year portfolio rationalization. The company is betting that a leaner, more focused toolmaker with a strengthened balance sheet will deliver better returns than a diversified industrial conglomerate. The next 12-18 months will tell whether that bet pays off.
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*Values retrieved from S&P Global