DISCONTINUED OPERATIONS

12 Months Ended

Dec. 29, 2012

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS

In October 2012, the Company entered into a definitive agreement to sell its Hardware & Home Improvement business ("HHI") to Spectrum Brands Holdings, Inc. ("Spectrum") for approximately $1.4 billion in cash, with the price subject to revision for the level of working capital at the date of sale. The purchase and sale agreement stipulates that the sale occur in a First and Second Closing, for approximately $1.3 billion and $100 million, respectively. HHI is a provider of residential locksets, residential builders hardware and plumbing products marketed under the Kwikset, Weiser, Baldwin, Stanley, National and Pfister brands. The majority of the HHI business was part of the Company's Security segment, with the remainder being part of the Company's CDIY segment. The divestiture of the HHI business is part of the continued diversification of the Company's revenue streams and geographic footprint. The HHI sale also includes the residential portion of the Tong Lung hardware business, which the Company acquired in the third quarter of 2012. The First Closing occurred on December 17, 2012 in which HHI, excluding the residential portion of the Tong Lung business, was sold for $1.261 billion in cash. The First Closing of the HHI sale resulted in an after-tax gain of $358.9 million. The Second Closing to sell the residential Tong Lung business for approximately $100 million is expected to occur no later than April 2013. The $100 million payment relating to the Second Closing has been held in escrow at December 29, 2012.

As part of the purchase and sale agreement, the Company will perform transition services relating to certain administrative functions for Spectrum primarily for a period of one year or less, pending Spectrum's integration of these functions into their pre-existing business processes.  Spectrum will pay a transition service fee to the Company as reimbursement for transition service costs incurred.  As discussed above, the divestiture of the residential Tong Long portion of the HHI business for $100 million is expected to occur no later than April 2013 and accordingly, there will be continuing cash flows associated with Tong Long. The Company evaluated the transition services and other continuing involvement and concluded that the expected continuing cash flows are not a significant portion of the disposed business.

During 2011, the Company sold three small businesses for total cash proceeds of $27.1 million and a cumulative after-tax loss of $18.8 million. These businesses were sold as the related product lines provided limited growth opportunity or were not considered part of the Company's core offerings.

As a result of these actions, the operating results of the businesses above, including the related gain and loss, are reported as discontinued operations. Amounts previously reported have been reclassified to conform to this presentation in accordance with ASC 205 to allow for meaningful comparison of continuing operations. The Consolidated Balance Sheets as of December 29, 2012 and December 31, 2011 aggregate amounts associated with discontinued operations as described above. Summarized operating results of discontinued operations are presented in the following table:

(Millions of Dollars)	2012		2011		2010
Net Sales	$	930.6	$	1,001.9	$	913.0
Earnings from discontinued operations before income taxes (including pretax gain on HHI sale of $384.7 million in 2012)	$	503.5	$	114.9	$	68.4
Income taxes on discontinued operations (including income taxes for gain on HHI sale of $25.8 million in 2012)	69.2		38.7		20.8
Net earnings from discontinued operations	$	434.3	$	76.2	$	47.6

As of December 29, 2012, assets and liabilities held for sale relating to the residential portion of the Tong Lung business totaled $133.4 million and $30.3 million, respectively. The carrying amounts of the assets and liabilities that were aggregated in assets held for sale and liabilities held for sale as of December 31, 2011 are presented in the following table:

(Millions of Dollars)	2011
Accounts and notes receivable, net	108.2
Inventories, net	167.7
Property, Plant and Equipment, net	108.3
Goodwill and other intangibles, net	655.0
Other Assets	11.0
Total assets	1,050.2
Accounts payable and accrued expenses	152.5
Other liabilities	61.4
Total liabilities	213.9