Stanley Black & Decker (SB&D) agreed to buy Sears Holdings’ Craftsman brand in a deal valued at $900 million. As part of the agreement, Sears Holdings will be granted a perpetual license to source and sell Craftsman-branded products in its stores – royalty-free for the first 15 years, and with a 3% royalty after that.

Under terms of the sale, expected to close later this year, Stanley will pay $525 million at the closing of the sale and $250 million at the end of the third year. Sears also will receive 2.5% of SB&D’s new Craftsman product sales through 2020; 3% of sales through January 2023, and 3.5% after that until 2032.

The separation of the brand from Sears conceivably could loosen the market for licensing the Craftsman brand for broad retail distribution. SB&D has long been an active licensor of both its core brands, represented by Beanstalk. In 2012, LMCA was named by Sears as its agency for the Craftsman, Kenmore and DieHard brands; the sole existing Craftsman licensee is Nebraska-based Warren Distribution, which licensed the brand for engine oils, according to LMCA, which parted ways with Sears last year.

SB&D President-CEO James Loree calls the acquisition “a significant opportunity to grow the market by increasing the availability of Craftsman products to consumers in previously underpenetrated channels. We intend to invest in the brand and rapidly increase sales through these new channels, including retail, industrial, mobile and online.” Currently, about 10% of Craftsman sales are outside of Sears, much of it via a 2010 agreement to sell Craftsman tools through the Ace Hardware network, as well subsequent pacts with such chains as Orchard Supply Hardware and Menards. A joint release says those outside sales, valued at about $200 million in the last year, would be immediately assumed by SB&D.

Sears’ Craftsman products will be required to meet Stanley’s quality standards, but the retailer will have its own pricing and product development strategy, Loree told analysts.

“We are not going to be taking distribution away from Sears,” Loree said. “We hope to revitalize it as the great American brand it once was and still is and we believe it can be enhanced in both innovation and brand power. The brand does play better to older folks who remember it from its heyday, but we hope to bring it to a new generation of customers.”