Kennametal ( KMT - Get Report) completed the sale of its J&L industrial supply business unit for $349.5 million to MSC Industrial Direct ( MSM - Get Report).

As a result of the transaction, Kennametal will recognize a pretax gain of an estimated $215 million to $225 million in the quarter ending June 30. This will boost earnings by about $3.15 to $3.25 a share. Net cash proceeds are expected to be $220 million to $225 million, including a repayment related to the company's accounts receivable securitization program.

The company also announced that its previously stated guidance will be reduced by about $28 million in sales and 7 cents a share in earnings associated with the month of June as the sale closed before it was expected.

The company intends to use proceeds from the sale to fund acquisitions in its core business, to buyback minority share interests in foreign subsidiaries, to buyback its stock, and to reduce debt. The disposition of this unit also completes the Kennametal's planned exit from owned distribution.

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