10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2012

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from  to  

Commission file number 1-4797

ILLINOIS TOOL WORKS INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	36-1258310
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
3600 W. Lake Avenue, Glenview, Illinois	60026-1215
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (847) 724-7500

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered
Common Stock	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes   x    No  o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes  o    No  x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  x    No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes  x    No  o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): 

Large accelerated filer	x	Accelerated filer	o
Non-accelerated filer	o  (Do not check if a smaller reporting company)	Smaller reporting company	o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes  o    No  x

The aggregate market value of the voting stock held by non-affiliates of the registrant as of June 30, 2012 was approximately $20,600,000,000 based on the New York Stock Exchange closing sales price as of June 30, 2012.

Shares of Common Stock outstanding at January 31, 2013: 451,435,783. 

Documents Incorporated by Reference

Portions of the 2013 Proxy Statement for Annual Meeting of Stockholders to be held on May 3, 2013. Part III

PART I

ITEM 1.Business

General

Illinois Tool Works Inc. (the “Company” or “ITW”) was founded in 1912 and incorporated in 1915. The Company is a multinational manufacturer of a diversified range of industrial products and equipment with operations in 58 countries. As of December 31, 2012, these businesses are internally reported as 40 operating segments to senior management. The Company’s 40 operating segments have been aggregated into the following seven external reportable segments:

Transportation: Businesses in this segment produce components, fasteners, fluids and polymers, as well as truck remanufacturing and related parts and service.

In the Transportation segment, products and services include:

• plastic and metal components, fasteners and assemblies for automobiles, light trucks, and other industrial uses;

• fluids, polymers and other supplies for auto aftermarket maintenance and appearance;

• fillers and putties for auto body repair;

• polyester coatings and patch and repair products for the marine industry; and

• truck remanufacturing and related parts and service.

Power Systems & Electronics: Businesses in this segment produce equipment and consumables associated with specialty power conversion, metallurgy and electronics.

In the Power Systems & Electronics segment, products include:

• arc welding equipment;

• metal arc welding consumables and related accessories;

• metal solder materials for PC board fabrication;

• equipment and services for microelectronics assembly;

• electronic components and component packaging;

• static and contamination control equipment;

• airport ground support equipment;

• pressure sensitive adhesives and components for telecommunications, electronics, medical and transportation applications; and

• metal jacketing and other insulation products.

Industrial Packaging: Businesses in this segment produce steel, plastic and paper products and equipment used for bundling, shipping and protecting goods in transit.

In the Industrial Packaging segment, products include:

• steel and plastic strapping and related tools and equipment;

• plastic stretch film and related equipment; and

• paper and plastic products that protect goods in transit.

Food Equipment: Businesses in this segment produce commercial food equipment and provide related service.

In the Food Equipment segment, products and services include:

• warewashing equipment;

• cooking equipment, including ovens, ranges and broilers;

• refrigeration equipment, including refrigerators, freezers and prep tables;

• food processing equipment, including slicers, mixers and scales;

• kitchen exhaust, ventilation and pollution control systems; and

• food equipment service, maintenance and repair.

Construction Products: Businesses in this segment produce construction fastening systems and truss products.

In the Construction Products segment, products include:

• fasteners and related fastening tools for wood and metal applications;

• anchors, fasteners and related tools for concrete applications;

• metal plate truss components and related equipment and software; and

• packaged hardware, fasteners, anchors and other products for retail.

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Polymers & Fluids: Businesses in this segment produce adhesives, sealants, lubrication and cutting fluids, and hygiene products.

In the Polymers & Fluids segment, products include:

• adhesives for industrial, construction and consumer purposes;

• chemical fluids which clean or add lubrication to machines;

• epoxy and resin-based coating products for industrial applications; and

• hand wipes and cleaners for industrial applications.

All Other: This segment contains all other operating segments.

In the All Other segment, products include:

• equipment and related software for testing and measuring of materials, structures, gases and fluids;

• plastic reclosable packaging for consumer food storage;

• plastic consumables that multi-pack cans and bottles and related equipment;

• plastic and metal fasteners and components for appliances;

• foil, film and related equipment used to decorate consumer products;

• product coding and marking equipment and related consumables; and

• line integration, conveyor systems and line automation for the food and beverage industries.

Divestiture of Majority Interest in Decorative Surfaces Segment

On August 15, 2012, the Company entered into a definitive agreement (the “Investment Agreement”) to divest a 51% majority interest in its Decorative Surfaces segment to certain funds managed by Clayton, Dubilier & Rice, LLC (“CD&R”). Under the terms of the Investment Agreement, the Company contributed the assets and stock of the Decorative Surfaces segment to a newly formed joint venture, Wilsonart International Holdings LLC (“Wilsonart”). The transaction closed on October 31, 2012, reducing the Company's ownership of Wilsonart to 49% immediately following the close of the transaction. The Company ceased consolidating the results of the Decorative Surfaces segment as of October 31, 2012 and now reports its 49% ownership interest in Wilsonart using the equity method of accounting. Effective November 1, 2012, the Company made changes to its management reporting structure and Decorative Surfaces is no longer a reportable segment of the Company. See the Divestiture of Majority Interest in Decorative Surfaces Segment note in Item 8. Financial Statements and Supplementary Data for further discussion of this transaction.

The Decorative Surfaces business produces decorative high-pressure laminate surfacing materials for furniture, office and retail space, countertops, worktops and other applications. Principal end markets served included commercial, renovation and residential construction.

Enterprise Initiatives

During 2012, the Company embarked on three key initiatives - portfolio management, strategic sourcing, and business structure simplification. These initiatives are expected to enhance the business over the next five years and are targeted at organic revenue growth, and improving profitability and returns.

Portfolio Management

The Company's portfolio management initiative incorporates both acquisitions and divestitures. The Company has historically acquired businesses with complementary products and services as well as larger acquisitions that represent potential new platforms. Going forward, the focus will be on businesses with strong differentiation and growth potential. The Company also reviews its operations for businesses which may no longer be aligned with its enterprise initiatives and long-term objectives.  As a result, the Company expects its divestiture activity in the 2012 to 2014 period to increase over historical periods.  Refer to the Acquisitions note in Item 8. Financial Statements and Supplementary Data for discussion of the Company's acquisitions, the Discontinued Operations note in Item 8. Financial Statements and Supplementary Data for discussion of the Company's discontinued operations, and the Divestiture of Majority Interest in Decorative Surfaces Segment note in Item 8. Financial Statements and Supplementary Data for discussion of the Decorative Surfaces divestiture.

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Strategic Sourcing

The Company's strategic sourcing initiative focuses on costs that cross the Company's many businesses and is expected to leverage purchasing scale to enhance profitability and global competitiveness. This initiative will transform sourcing into a core strategic function in the Company and build capabilities at both the enterprise and segment levels.

Business Structure Simplification

The business structure simplification initiative simplifies and adds scale to the Company's operating divisions in order to improve focus, enhance global competitiveness and drive operational efficiencies. This initiative will reduce the number of the Company's operating divisions and increase the average revenue size of each division, while retaining the positive attributes of a decentralized operating model. The Company expects to enhance its profitability and returns through a combination of applying its 80/20 business process to the new divisions, more focused growth investments and reduced infrastructure.

80/20 Business Process

A key element of the Company’s business strategy is its continuous 80/20 business process for both existing businesses and new acquisitions. The basic concept of this 80/20 business process is to focus on what is most important (the 20% of the items which account for 80% of the value) and to spend less time and resources on the less important (the 80% of the items which account for 20% of the value). The Company’s operations use this 80/20 business process to simplify and focus on the key parts of their business, and as a result, reduce complexity that often disguises what is truly important. The Company’s operations utilize the 80/20 process in various aspects of their business. Common applications of the 80/20 business process include:

• Simplifying product lines by reducing the number of products offered by combining the features of similar products, outsourcing products or, as a last resort, eliminating low-value products.

• Segmenting the customer base by focusing on the 80/20 customers separately and finding alternative ways to serve the 20/80 customers.

• Simplifying the supplier base by partnering with 80/20 suppliers and reducing the number of 20/80 suppliers.

• Designing business processes, systems and measurements around the 80/20 activities.

The result of the application of this 80/20 business process is that the Company has over time improved its long-term operating and financial performance. These 80/20 efforts can result in restructuring projects that reduce costs and improve margins. Corporate management works closely with those businesses that have operating results below expectations to help those businesses better apply this 80/20 business process and improve their results.

Current Year Developments

Refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Financial Information about Segments and Markets

Segment and operating results are included in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Segment Information note in Item 8. Financial Statements and Supplementary Data.

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The principal end markets served by the Company’s seven reportable segments by percentage of revenue are as follows:

End Markets Served	Transportation		Power Systems & Electronics		Industrial Packaging		Food Equipment		Construction Products		Polymers & Fluids		All Other		Total
General Industrial	5	%	43	%	27	%	1	%	2	%	33	%	27	%	20	%
Automotive OEM/Tiers	53		3		1		—		1		4		4		12
Automotive Aftermarket	31		2		—		—		—		1		—		7
Commercial Construction	1		6		6		—		25		11		1		6
Residential Construction	—		1		3		—		44		2		1		6
Renovation Construction	—		1		—		—		26		1		—		3
Food & Beverage	—		—		10		—		—		3		21		5
Food Institutional/Restaurant	—		—		—		42		—		1		—		5
Food Service	—		—		—		38		—		2		2		5
Food Retail	—		—		1		16		—		—		2		2
Consumer Durables	3		2		4		—		2		4		12		4
Electronics	—		17		1		—		—		2		1		4
Primary Metals	—		1		22		—		—		2		1		4
Other	7		24		25		3		—		34		28		17
	100	%	100	%	100	%	100	%	100	%	100	%	100	%	100	%

Other includes several end markets, some of which are maintenance, repair and operations, or “MRO”, paper products, and printing and publishing.

The Company’s businesses primarily distribute their products directly to industrial manufacturers and through independent distributors.

Backlog

Backlog generally is not considered a significant factor in the Company’s businesses as relatively short delivery periods and rapid inventory turnover are characteristic of most of its products. Backlog by reportable segment as of December 31, 2012 and 2011 was as follows:

In millions	2012		2011
Transportation	$	351	$	350
Power Systems & Electronics	235		258
Industrial Packaging	140		151
Food Equipment	192		213
Construction Products	22		32
Polymers & Fluids	57		55
All Other	445		390
Total	$	1,442	$	1,449

Backlog orders scheduled for shipment beyond calendar year 2013 were not material as of December 31, 2012.

The information set forth below is applicable to all reportable segments of the Company unless otherwise noted:

Competition

With operations in 58 countries, the Company offers a wide range of products in a myriad of markets, many of which are fragmented, and the Company encounters a variety of competitors that vary by product line, end market and geographic area. The Company's competitors include many regional or specialized companies, as well as large U.S. and non-U.S. companies or divisions of large companies. Each of the Company's segments generally has several main competitors and numerous smaller ones in most of their end markets and geographic areas. In addition to numerous smaller regional competitors, the welding

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business in the Power Systems & Electronics segment competes globally with Lincoln Electric.

In virtually all segments, the Company differentiates its businesses from its competitors based on product innovation, product quality, brand preference, service delivery and price. Technical capability is also a competitive factor in most of its segments. The Company believes that for each of its segments, its primary competitive advantages derive from its decentralized operating structure, which creates a strong focus on end markets and customers at the local level, enabling its businesses to respond rapidly to market dynamics. This structure enables the Company's businesses to drive operational excellence utilizing its 80/20 business process and leverages its product innovation capabilities. The Company also believes that its global footprint is a competitive advantage in many of its markets, especially in its Transportation segment.

Raw Materials

The Company uses raw materials of various types, primarily steel, resins, chemicals and paper, that are available from numerous commercial sources. The availability of materials and energy has not resulted in any significant business interruptions or other major problems, and no such problems are currently anticipated.

Research and Development

Developing new and improved products, broadening the application of established products, and continuing efforts to improve and develop new methods, processes and equipment all contribute to the Company’s organic growth. Many new products are designed to reduce customers’ costs by eliminating steps in their manufacturing processes, reducing the number of parts in an assembly or by improving the quality of customers’ assembled products. Typically, the development of such products is accomplished by working closely with customers on specific applications. Research and development expenses were $266 million in 2012, $243 million in 2011 and $213 million in 2010.

Intellectual Property

The Company owns approximately 3,700 unexpired U.S. patents and 8,000 foreign patents covering articles, methods and machines. In addition, the Company has approximately 1,900 applications for patents pending in the U.S. Patent Office and 4,500 pending in foreign patent offices, but there is no assurance that any of these patents will be issued. The Company maintains an active patent department for the administration of patents and processing of patent applications.

The Company believes that many of its patents are valuable and important; however, the expiration of any one of the Company’s patents would not have a material effect on the Company’s results of operations or financial position. The Company also credits its leadership in the markets it serves to engineering capability; manufacturing techniques; skills and efficiency; marketing and sales promotion; and service and delivery of quality products to its customers.

In addition to patents, many of the Company’s products and services are sold under various owned or licensed trademarks, which are important to the Company in the aggregate. Some of the Company’s more significant trademarks include ITW, which is also used in conjunction with the trademarks of many of the Company's businesses; Deltar and Shakeproof in the Transportation segment; Miller in the Power Systems & Electronics segment; Signode in the Industrial Packaging segment; Hobart in the Food Equipment segment; Paslode in the Construction Products segment; and Instron in the All Other segment.

Environmental

The Company believes that its manufacturing plants and equipment are in substantial compliance with all applicable environmental regulations. Additional measures to maintain compliance are not expected to materially affect the Company’s capital expenditures, competitive position, financial position or results of operations.

Various legislative and administrative regulations concerning environmental issues have become effective or are under consideration in many parts of the world relating to manufacturing processes and the sale or use of certain products. To date, such developments have not had a substantial adverse impact on the Company’s revenues or earnings. The Company has made considerable efforts to develop and sell environmentally compatible products.

Employees

The Company employed approximately 60,000 persons as of December 31, 2012 and considers its employee relations to be excellent.

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International

The Company’s international operations include subsidiaries and joint ventures in 57 foreign countries on six continents. These operations serve such end markets as general industrial, automotive, construction, food institutional/restaurant and service, food and beverage, consumer durables, electronics, primary metals, and others on a worldwide basis. The Company’s revenues from sales to customers outside the U.S. were approximately 57% of revenues in 2012, 59% of revenues in 2011 and 58% of revenues in 2010.

Refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Segment Information note in Item 8. Financial Statements and Supplementary Data for additional information on international activities. International operations are subject to certain risks inherent in conducting business in foreign countries, including price controls, exchange controls, limitations on participation in local enterprises, nationalization, expropriation and other governmental action, and changes in currency exchange rates. Additional risks of the Company's international operations are described under “Item 1A. Risk Factors.”

Executive Officers

Executive Officers of the Company as of February 19, 2013 were as follows:

Name	Office	Age
Sharon M. Brady	Senior Vice President, Human Resources	62
Timothy J. Gardner	Executive Vice President	57
Maria C. Green	Senior Vice President, General Counsel & Secretary	60
John R. Hartnett	Executive Vice President	52
Craig A. Hindman	Executive Vice President	58
Ronald D. Kropp	Senior Vice President & Chief Financial Officer	47
Roland M. Martel	Executive Vice President	58
Steven L. Martindale	Executive Vice President	56
Sundaram Nagarajan	Executive Vice President	50
Christopher O’Herlihy	Executive Vice President	49
David C. Parry	Vice Chairman	59
E. Scott Santi	President & Chief Executive Officer	51
Randall J. Scheuneman	Vice President & Chief Accounting Officer	45
Juan Valls	Executive Vice President	51
Jane L. Warner	Executive Vice President	66

The executive officers of the Company serve at the pleasure of the Board of Directors. Except for Ms. Green and Messrs. Gardner, Martindale, Nagarajan, O’Herlihy, Scheuneman, and Hartnett, each of the foregoing officers has been employed by the Company in various elected executive capacities for more than five years. Ms. Green was elected Senior Vice President, General Counsel & Secretary of the Company in February 2012. She joined the Company in 1997 as an Associate General Counsel and Assistant Secretary, became Deputy General Counsel and Assistant Secretary in 2008, and was elected Vice President, General Counsel & Secretary in August 2011. Mr. Gardner was elected Executive Vice President in 2009. He joined the Company in 1997 and has held various sales and management positions in the consumer packaging businesses. Most recently, he served as Group President of the consumer packaging businesses. Mr. Martindale was elected Executive Vice President in 2008. Prior to joining the Company in 2005 as President of the test and measurement businesses, he was Chief Financial Officer and Chief Operating Officer of Instron. Mr. Nagarajan was elected Executive Vice President in 2010. He joined the Company in 1991 and has held various engineering and management positions in the welding businesses. Most recently, he served as Group President within the welding businesses. Mr. O’Herlihy was elected Executive Vice President in 2010. He joined the Company in 1989 and has held various operational, management and leadership positions of increasing responsibility. Most recently he served as President, international food equipment businesses. Mr. Scheuneman was appointed Vice President and Chief Accounting Officer in 2009. Prior to joining the Company in 2009, he held several financial leadership positions at W.W. Grainger, Inc., including Vice President, Finance, for the Lab Safety Supply business from 2006 to 2009, and Vice President, Internal Audit, from 2002 to 2006. He was appointed Principal Accounting Officer in 2009. Mr. Hartnett was elected Executive Vice President of Construction Products in 2012. He joined Signode in 1980, which was acquired by ITW in 1986, and has held various management positions of increasing responsibility. Most recently, he served as Group President of the Automotive Aftermarket businesses.

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On November 17, 2012, David B. Speer, ITW Chairman & CEO since 2006, passed away after an illness. On November 18, 2012, E. Scott Santi was elected President & Chief Executive Officer as well as a director, after having been elected President and Chief Operating Officer in October 2012.

Available Information

The Company electronically files reports with the Securities and Exchange Commission (SEC). The public may read and copy any materials the Company has filed with the SEC at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains an internet site (www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Copies of the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are also available free of charge through the Company’s website (www.itw.com), as soon as reasonably practicable after electronically filing with or otherwise furnishing such information to the SEC, and are available in print to any shareholder who requests them. Also posted on the Company’s website are the following:

• Statement of Principles of Conduct;

• Code of Ethics for CEO and key financial and accounting personnel;

• Charters of the Audit, Corporate Governance and Nominating, and Compensation Committees of the Board of Directors;

• Corporate Governance Guidelines;

• Global Anti-Corruption Policy;

• Corporate Citizenship Statement; and

• Government Affairs Information.

ITEM 1A.Risk Factors

The Company's business, financial condition, results of operations and cash flows are subject to various risks, including, but not limited to, those set forth below, which could cause actual results to vary materially from recent results or from anticipated future results. These risk factors should be considered together with information included elsewhere in this Annual Report on Form 10-K.

The Company's results are impacted by global economic conditions. Weakness or downturns in the markets served by the Company could adversely affect its business, results of operations or financial condition.

During 2012, North American economic conditions were stronger than the European and Asia Pacific economic environments as European sales declined and growth in Asia slowed. The Company cannot give assurance that it will not experience adverse effects from broad economic trends in Europe, Asia or other geographies. Instability in global economic conditions could have an adverse effect on the Company's business, results of operations or financial condition.

The global nature of the Company's operations subjects it to political and economic risks that could adversely affect its business, results of operations or financial condition.

The Company currently operates in 58 countries. In 2012, approximately 57% of the Company's revenues were generated from sales to customers outside of the U.S. As the Company continues to expand its global footprint, these sales may represent an increasing portion of the Company's revenues. The risks inherent in the Company's global operations include:

• fluctuation in currency exchange rates;

• limitations on ownership or participation in local enterprises;

• price controls, exchange controls and limitations on repatriation of earnings;

• transportation delays and interruptions;

• political, social and economic instability and disruptions;

• acts of terrorism;

• government embargoes or foreign trade restrictions;

• the imposition of duties and tariffs and other trade barriers;

• import and export controls;

• labor unrest and current and changing regulatory environments;

• the potential for expropriation or nationalization of enterprises;

• difficulties in staffing and managing multi-national operations;

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• limitations on its ability to enforce legal rights and remedies; and

• potentially adverse tax consequences.

If the Company is unable to successfully manage these and other risks associated with managing and expanding its international businesses, the risks could have a material adverse effect on the Company's business, results of operations or financial condition.

If the Company is unable to successfully manage its enterprise initiatives, financial results could be adversely impacted.

The Company has begun executing the following new long-term enterprise initiatives: business structure simplification, strategic sourcing and portfolio management. These initiatives include the scaling up of smaller businesses into larger businesses, better leveraging of purchasing power, and divesting non-core assets while targeting acquisitions with strong differentiation and growth potential. If the Company is unable to retain its key employees, successfully integrate acquisitions, maintain productivity or otherwise implement these initiatives without material disruption to its businesses, financial results could be adversely impacted.

Divestitures could negatively impact the Company's business, and retained liabilities from businesses that the Company sells could adversely affect the Company's financial results.

As part of its portfolio management initiative, the Company reviews its operations for businesses which may no longer be aligned with its enterprise initiatives and long-term objectives. As a result, the Company expects its divestiture activity in the 2012 to 2014 period to increase over historical periods. Divestitures pose risks and challenges that could negatively impact the Company's business, including the potentially dilutive effect on earnings per share, distraction of management's attention from core businesses, potential disputes with buyers and potential impairment charges. In addition, the Company may be required to retain responsibility for, or agree to indemnify buyers against contingent liabilities related to the businesses sold, such as lawsuits, tax liabilities, product liability claims and environmental matters.

The Company's acquisition of businesses could negatively impact its profitability and return on invested capital.

Acquisitions involve a number of risks and financial, accounting, managerial and operational challenges, including the following, any of which could adversely affect the Company's growth and profitability:

• Any acquired business, technology, service or product could under-perform relative to the Company's expectations and the price paid for it, or not perform in accordance with the Company's anticipated timetable.

• Acquisitions could cause the Company's financial results to differ from expectations in any given fiscal period, or over the long term.

• Acquisition-related earnings charges could adversely impact operating results.

• Acquisitions could place unanticipated demands on the Company's management, operational resources and financial and internal control systems.

• The Company may assume unknown liabilities, known contingent liabilities that become realized or known liabilities that prove greater than anticipated. The realization of any of these liabilities may increase the Company's expenses or adversely affect its financial position.

• As a result of acquisitions, the Company has in the past recorded significant goodwill and other identifiable intangible assets on its balance sheet. If the Company is not able to realize the value of these assets, it may incur charges relating to the impairment of these assets.

The Company may incur fines or penalties, damage to its reputation or other adverse consequences if its employees, agents or business partners violate anti-bribery or other laws.

The Company cannot provide assurance that its internal controls will always protect it from reckless or criminal acts committed by its employees, agents or business partners that would violate U.S. and/or non-U.S. laws, including anti-bribery laws, competition, and export and import compliance. Any such improper actions could subject the Company to civil or criminal investigations in the U.S. and in other jurisdictions, could lead to substantial civil or criminal monetary and non-monetary penalties against the Company or its subsidiaries, and could damage its reputation.

A significant fluctuation between the U.S. Dollar and other currencies could adversely impact the Company's operating income.

Although the Company's financial results are reported in U.S. Dollars, a significant portion of its sales and operating costs are realized in other currencies, with the largest concentration of foreign sales occurring in Europe. The Company's profitability is affected by movements of the U.S. Dollar against the Euro and other foreign currencies in which it generates revenues and

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incurs expenses. Significant long-term fluctuations in relative currency values, in particular an increase in the value of the U.S. Dollar against foreign currencies, could have an adverse effect on profitability and financial condition.

Diminished credit availability could adversely impact the Company's ability to readily obtain financing or to obtain cost-effective financing.

The Company may utilize the commercial paper markets for a portion of its short-term liquidity needs. If conditions in the financial markets decline, there is no assurance that the commercial paper markets will remain available to the Company or that the lenders participating in the Company's long-term credit facilities will be able to provide financing in accordance with the terms of its credit agreements. A failure of one or more of the syndicate members in the Company's credit facilities could reduce the availability of credit and adversely affect the Company's liquidity. If the Company determines that it is appropriate or necessary to raise capital in the future, funds may not be available on cost-effective terms.

Raw material price increases and supply shortages could adversely affect results.

The supply of raw materials to the Company and to its component parts suppliers could be interrupted for a variety of reasons, including availability and pricing. Prices for raw materials necessary for production have fluctuated significantly in the past and significant increases could adversely affect the Company's results of operations and profit margins. Due to pricing pressure or other factors, the Company may not be able to pass along increased raw material and components parts prices to its customers in the form of price increases or its ability to do so could be delayed. Consequently, its results of operations and financial condition may be adversely affected.

If the Company is unable to successfully introduce new products or adequately protect its intellectual property, its future growth may be adversely affected.

The Company's ability to develop new products based on innovation can affect its competitive position and often requires the investment of significant resources. Difficulties or delays in research, development or production of new products and services or failure to gain market acceptance of new products and technologies may reduce future revenues and adversely affect the Company's competitive position.

Protecting the Company's intellectual property is critical to its innovation efforts. The Company owns a number of patents, trademarks and licenses related to its products and has exclusive and non-exclusive rights under patents owned by others. The Company's intellectual property may be challenged or infringed upon by third parties, particularly in countries where property rights are not highly developed or protected, or the Company may be unable to maintain, renew or enter into new license agreements with third-party owners of intellectual property on reasonable terms. Unauthorized use of the Company's intellectual property rights or inability to preserve existing intellectual property rights could adversely impact the Company's competitive position and results of operations.

Unfavorable tax law changes and tax authority rulings may adversely affect results.

The Company is subject to income taxes in the United States and in various foreign jurisdictions. Domestic and international tax liabilities are based on the income and expenses in various tax jurisdictions. The Company's effective tax rate could be adversely affected by changes in the mix of earnings among countries with differing statutory tax rates, changes in the valuation allowance of deferred tax assets or tax laws. The amount of income taxes and other taxes are subject to ongoing audits by U.S. federal, state and local tax authorities and by non-U.S. authorities. If these audits result in assessments different from amounts recorded, future financial results may include unfavorable tax adjustments.

The Company's defined benefit pension plans are subject to financial market risks that could adversely affect its results of operations and cash flows.

The performance of the financial markets and interest rates impact the Company's funding obligations under its defined benefit pension plans. Significant changes in market interest rates, decreases in the fair value of plan assets and investment losses on plan assets may increase the Company's funding obligations and adversely impact its results of operations and cash flows.

Potential adverse outcome in legal proceedings may adversely affect results.

The Company's businesses expose it to potential toxic tort and other types of product liability claims that are inherent in the design, manufacture and sale of its products and the products of third-party vendors. The Company currently maintains insurance programs consisting of self insurance up to certain limits and excess insurance coverage for claims over established limits. There can be no assurance that the Company will be able to obtain insurance on acceptable terms or that its insurance programs will provide adequate protection against actual losses. In addition, the Company is subject to the risk that one or more of its insurers may become insolvent and become unable to pay claims that may be made in the future. Even if it maintains

10

adequate insurance programs, successful claims could have a material adverse effect on the Company's financial condition, liquidity and results of operations and on its ability to obtain suitable, adequate or cost-effective insurance in the future.

Forward-Looking Statements

This Annual Report on Form 10-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “believe,” “expect,” “plans,” “intends,” “may,” “strategy,” “prospects,” “estimate,” “project,” “target,” “anticipate,” “guidance,” “forecast,” and other similar words, including, without limitation, statements regarding the expected acquisition or disposition of businesses, economic conditions in various geographic regions, the Company's ability to manage its strategic business initiatives, the adequacy of internally generated funds and credit facilities, the meeting of dividend payout objectives, the ability to fund debt service obligations, the Company's portion of future benefit payments related to pension and postretirement benefits, the availability of additional financing, the availability of raw materials and energy, the expiration of any one of the Company's patents, the cost of compliance with environmental regulations, the likelihood of future goodwill or intangible asset impairment charges, the outcome of outstanding legal proceedings, the impact of adopting new accounting pronouncements, and the estimated timing and amount related to the resolution of tax matters. These statements are subject to certain risks, uncertainties, and other factors, which could cause actual results to differ materially from those anticipated. Important risks that may influence future results include those risks described above. These risks are not all inclusive and given these and other possible risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

Any forward-looking statements made by ITW speak only as of the date on which they are made. ITW is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of new information, subsequent events or otherwise.

ITW practices fair disclosure for all interested parties. Investors should be aware that while ITW regularly communicates with securities analysts and other investment professionals, it is against ITW's policy to disclose to them any material non-public information or other confidential commercial information. Shareholders should not assume that ITW agrees with any statement or report issued by any analyst irrespective of the content of the statement or report.

ITEM 1B.Unresolved Staff Comments

Not applicable.

ITEM 2.Properties

As of December 31, 2012, the Company operated the following plants and office facilities, excluding regional sales offices and warehouse facilities:

	Number Of Properties	Floor Space
		Owned	Leased	Total
		(In millions of square feet)
Transportation	104	4.2	2.5	6.7
Power Systems & Electronics	115	5.5	2.0	7.5
Industrial Packaging	130	6.3	4.4	10.7
Food Equipment	46	3.2	0.6	3.8
Construction Products	89	3.1	1.0	4.1
Polymers & Fluids	103	3.6	1.9	5.5
All Other	179	6.0	3.4	9.4
Corporate	36	2.9	0.2	3.1
Total	802	34.8	16.0	50.8

The principal plants and office facilities outside of the U.S. are in Australia, Belgium, Brazil, Canada, China, Czech Republic, Denmark, France, Germany, Italy, Netherlands, Spain, Switzerland and the United Kingdom.

11

The Company’s properties are primarily of steel, brick or concrete construction and are maintained in good operating condition. Production capacity, in general, currently exceeds operating levels. Capacity levels are somewhat flexible based on the number of shifts operated and on the number of overtime hours worked. The Company adds production capacity from time to time as required by increased demand. Additions to capacity can be made within a reasonable period of time due to the nature of the Company's businesses.

ITEM 3.Legal Proceedings

Not applicable.

ITEM 4.Mine Safety Disclosures

Not applicable.

PART II

ITEM 5.Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Common Stock Price and Dividend Data—The common stock of Illinois Tool Works Inc. was listed on the New York Stock Exchange for 2012 and 2011. Quarterly market price and dividend data for 2012 and 2011 were as shown below:

	Market Price Per Share				Dividends Declared
	High		Low		Per Share
2012:
Fourth quarter	$	63.33	$	58.20	$	0.38
Third quarter	62.09		49.07		0.38
Second quarter	58.27		50.35		0.36
First quarter	58.24		47.42		0.36
2011:
Fourth quarter	$	49.92	$	39.12	$	0.36
Third quarter	59.27		40.82		0.36
Second quarter	58.79		52.09		0.34
First quarter	56.36		52.42		0.34

The approximate number of holders of record of common stock as of January 31, 2013 was 8,916. This number does not include beneficial owners of the Company’s securities held in the name of nominees.

12

Repurchases of Common Stock - On May 6, 2011, the Company’s Board of Directors authorized a new stock repurchase program which provides for the buyback of up to $4 billion of the Company’s common stock over an open-ended period of time (the “2011 Program”). Initial buybacks under the 2011 program of $79 million were made in the third quarter of 2011. Buybacks resumed with an additional $474 million of repurchases made in the first quarter of 2012, $526 million in the second quarter of 2012, $416 million in the third quarter of 2012, and an additional $604 million in the fourth quarter of 2012 as summarized in the table below.  As of December 31, 2012, there was approximately $1.9 billion of authorized repurchases remaining under the 2011 Program.

Share repurchase activity under this program for the fourth quarter of 2012 was as follows:

In millions except per share amounts
Period	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Program	Maximum Value of Shares That May Yet Be Purchased Under Program
October 2012	2.2	$	59.91	2.2	$	2,371
November 2012	3.3	$	60.58	3.3	$	2,174
December 2012	4.4	$	61.58	4.4	$	1,901
Total	9.9			9.9

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ITEM 6.Selected Financial Data

In millions except per share amounts	2012		2011		2010		2009		2008
Operating revenues	$	17,924	$	17,787	$	15,416	$	13,573	$	16,544
Income from continuing operations	2,495		2,017		1,452		969		1,624
Income from continuing operations per common share:
Basic	5.31		4.10		2.90		1.94		3.13
Diluted	5.27		4.08		2.89		1.93		3.12
Total assets at year-end	19,309		17,984		16,412		15,811		15,204
Long-term debt at year-end	4,589		3,488		2,542		2,861		1,248
Cash dividends declared per common share	1.48		1.40		1.30		1.24		1.18

Certain reclassifications of prior years’ data have been made to conform to current year reporting, including the elimination of the one-month lag effective January 1, 2011 for the reporting of the Company’s international operations outside of North America (fiscal years 2010 and 2009 only), and discontinued operations as discussed below.

Prior to 2011, the Company’s international operations outside of North America had a fiscal reporting period that began on December 1 and ended on November 30. Effective January 1, 2011, the Company eliminated the one-month lag for the reporting of its international operations outside of North America. As a result, the Company is now reporting both North American and international results on a calendar year basis. The Company determined that the elimination of the one-month reporting lag was preferable because the same period-end reporting date improves overall financial reporting as the impact of current events, economic conditions and global trends are consistently reflected in the financial statements of the North American and international businesses. The Company applied this change in accounting principle retrospectively to fiscal periods 2010 and 2009. Refer to the International Reporting Lag note in Item 8. Financial Statements and Supplementary Data for discussion of this change in accounting principle.

The Company periodically reviews its operations for businesses that may no longer be aligned with its long-term objectives. For businesses reported as discontinued operations in the statement of income, all related prior period income statement information has been restated to conform to the current year reporting of these businesses. Income (loss) from discontinued operations was $375 million, $54 million, $51 million, $4 million, and ($105 million) in the years 2012, 2011, 2010, 2009, and 2008, respectively. Refer to the Discontinued Operations note in Item 8. Financial Statements and Supplementary Data for discussion of the Company’s discontinued operations.

On August 15, 2012, the Company entered into a definitive agreement (the “Investment Agreement”) to divest a 51% majority interest in its Decorative Surfaces segment to certain funds managed by Clayton, Dubilier & Rice, LLC (“CD&R”). Under the terms of the Investment Agreement, the Company contributed the assets and stock of the Decorative Surfaces segment to a newly formed joint venture, Wilsonart International Holdings LLC (“Wilsonart”). The transaction closed on October 31, 2012, reducing the Company's ownership of Wilsonart to 49% immediately following the close of the transaction. The Company recorded a pre-tax gain of $933 million ($632 million after-tax) related to this transaction. The Company ceased consolidating the results of the Decorative Surfaces segment as of October 31, 2012 and now reports its 49% ownership interest in Wilsonart using the equity method of accounting. Effective November 1, 2012, the Company made changes to its management reporting structure and Decorative Surfaces is no longer a reportable segment of the Company. See the Divestiture of Majority Interest in Decorative Surfaces Segment note in Item 8. Financial Statements and Supplementary Data for further discussion of this transaction.

On January 1, 2009, the Company adopted new accounting guidance related to business combinations. The new accounting guidance requires an entity to recognize assets acquired, liabilities assumed, contractual contingencies and contingent consideration at their fair value on the acquisition date. This new guidance also requires prospectively that (1) acquisition-related costs be expensed as incurred; (2) restructuring costs generally be recognized as post-acquisition expenses; and (3) changes in deferred tax asset valuation allowances and income tax uncertainties after the measurement period impact income tax expense. Adoption of this guidance did not have a material impact on the Company's financial statements.

On January 1, 2009, the Company adopted new accounting guidance on fair value measurements for all nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair value on a nonrecurring basis. The new accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants and provides guidance for measuring fair values and the necessary disclosures. Adoption of this guidance did not have a material impact on the Company's financial statements.

Information on the comparability of results is included in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

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ITEM 7.Management's Discussion and Analysis of Financial Condition and Results of Operations

INTRODUCTION

Illinois Tool Works Inc. (the “Company” or “ITW”) is a multinational manufacturer of a diversified range of industrial products and equipment with operations in 58 countries. As of December 31, 2012, these businesses are internally reported as 40 operating segments to senior management. The Company’s 40 operating segments have been aggregated into the following seven external reportable segments: Transportation; Power Systems & Electronics; Industrial Packaging; Food Equipment; Construction Products; Polymers & Fluids; and All Other.

Due to the large number of diverse businesses and the Company’s decentralized operating structure, the Company does not require its businesses to provide detailed information on operating results. Instead, the Company’s corporate management collects data on several key measurements: operating revenues, operating income, operating margins, overhead costs, number of months on hand in inventory, days sales outstanding in accounts receivable, past due receivables and return on invested capital. These key measures are monitored by management and significant changes in operating results versus current trends in end markets and variances from forecasts are discussed with operating unit management.

Management analyzes the Company's consolidated results of operations and the results of each segment by identifying the effects of changes in the results of the base businesses, newly acquired and recently divested companies, restructuring costs, goodwill and intangible asset impairment charges, and currency translation on the operating revenues and operating income of each segment. Base businesses are those businesses that have been included in the Company's results of operations for more than 12 months. The changes to base business operating income include the estimated effects of both operating leverage and changes in variable margins and overhead costs. Operating leverage is the estimated effect of the base business revenue volume changes on operating income, assuming variable margins remain the same as the prior period. As manufacturing and administrative overhead costs usually do not significantly change as a result of revenues increasing or decreasing, the percentage change in operating income due to operating leverage is usually more than the percentage change in the base business revenues. Changes in variable margins and overhead costs represent the estimated effect of non-volume related changes in base business operating income and may be driven by a number of factors, including changes in product mix, the cost of raw materials, labor and overhead, and pricing to customers. Selling price versus material cost comparisons represent the estimated net impact of increases or decreases in the cost of materials used in the Company's products versus changes in the selling price to the Company's customers. Management reviews these price versus cost comparisons by analyzing the net impact of changes to each segment's operating margin.

A key element of the Company’s business strategy is its continuous 80/20 business process for both existing businesses and new acquisitions. The basic concept of this 80/20 business process is to focus on what is most important (the 20% of the items which account for 80% of the value) and to spend less time and resources on the less important (the 80% of the items which account for 20% of the value). The Company’s operations use this 80/20 business process to simplify and focus on the key parts of their business, and as a result, reduce complexity that often disguises what is truly important. The Company’s operations utilize the 80/20 process in various aspects of their businesses. Common applications of the 80/20 business process include:

• Simplifying product lines by reducing the number of products offered by combining the features of similar products, outsourcing products or, as a last resort, eliminating low-value products.

• Segmenting the customer base by focusing on the 80/20 customers separately and finding alternative ways to serve the 20/80 customers.

• Simplifying the supplier base by partnering with 80/20 suppliers and reducing the number of 20/80 suppliers.

• Designing business processes, systems and measurements around the 80/20 activities.

The result of the application of this 80/20 business process is that the Company has over time improved its long-term operating and financial performance. These 80/20 efforts can result in restructuring projects that reduce costs and improve margins. Corporate management works closely with those businesses that have operating results below expectations to help those businesses better apply this 80/20 business process and improve their results.

INTERNATIONAL REPORTING CHANGE

Effective January 1, 2011, the Company eliminated the one-month lag for the reporting of its international operations outside of North America. As a result, the Company now reports both North American and international results on a calendar year basis. Prior to this, the international fiscal reporting period began on December 1st and ended on November 30th. The Company applied this change in accounting principle retrospectively to all prior financial statement periods presented. Refer to the International Reporting Lag note in Item 8. Financial Statements and Supplementary Data for discussion of the international reporting change.

15

DIVESTITURE OF MAJORITY INTEREST IN DECORATIVE SURFACES SEGMENT

On August 15, 2012, the Company entered into a definitive agreement (the “Investment Agreement”) to divest a 51% majority interest in its Decorative Surfaces segment to certain funds managed by Clayton, Dubilier & Rice, LLC (“CD&R”). Under the terms of the Investment Agreement, the Company contributed the assets and stock of the Decorative Surfaces segment to a newly formed joint venture, Wilsonart International Holdings LLC (“Wilsonart”). The transaction closed on October 31, 2012, reducing the Company's ownership of Wilsonart to 49% immediately following the close of the transaction. The Company ceased consolidating the results of the Decorative Surfaces segment as of October 31, 2012 and now reports its 49% ownership interest in Wilsonart using the equity method of accounting. Effective November 1, 2012, the Company made changes to its management reporting structure and Decorative Surfaces is no longer a reportable segment of the Company. See the Divestiture of Majority Interest in Decorative Surfaces Segment note in Item 8. Financial Statements and Supplementary Data for further discussion of this transaction.

DISCONTINUED OPERATIONS

The Company periodically reviews its operations for businesses that may no longer be aligned with its long-term objectives. For businesses reported as discontinued operations in the statement of income, all related prior period income statement information has been restated to conform to the current year reporting of these businesses. Refer to the Discontinued Operations note in Item 8. Financial Statements and Supplementary Data for discussion of the Company’s discontinued operations.

STRATEGIC REVIEW OF INDUSTRIAL PACKAGING SEGMENT

On February 19, 2013, the Company announced that it is initiating a review process to explore strategic alternatives for its Industrial Packaging segment, which may include a sale or spin-off of the business. The Company expects the review process will last through the remainder of 2013. 

2011 AND 2012 SEGMENT CHANGES

The Company periodically makes changes to its management reporting structure to better align its businesses with Company objectives and operating strategies.

In the first quarter of 2011, the Company made certain changes in its management reporting structure that resulted in changes in some of the reportable segments. The pressure sensitive adhesives, and the static and contamination control reporting units were moved to the Power Systems & Electronics segment from the Polymers & Fluids and All Other segments, respectively. The changes in the reportable segments and underlying reporting units did not result in any goodwill impairment charges in the first quarter of 2011.

In the first quarter of 2012, the Company made certain changes in its management reporting structure that resulted in changes in some of the reportable segments. These changes primarily related to the industrial fasteners reporting unit, formerly in the All Other segment, moving to the Transportation segment; certain businesses in a Latin American reporting unit, formerly in the Polymers & Fluids segment, moving to the Transportation segment; and a worldwide insulation reporting unit, formerly in the Industrial Packaging segment, moving to the Power Systems & Electronics segment. The changes in the reportable segments and underlying reporting units did not result in any goodwill impairment charges in the first quarter of 2012.

The prior period segment results have been restated to conform to the current year reporting of these businesses.

CONSOLIDATED RESULTS OF OPERATIONS

The Company’s consolidated results of operations for 2012, 2011 and 2010 are summarized as follows:

Dollars in millions	2012			2011			2010
Operating revenues	$	17,924		$	17,787		$	15,416
Operating income	2,847			2,731			2,254
Margin %	15.9		%	15.4		%	14.6		%

16

In 2012 and 2011, the changes in revenues, operating income and operating margins over the prior year were primarily due to the following factors:

	2012 Compared to 2011						2011 Compared to 2010
	% Increase (Decrease)				% Point  Increase (Decrease)		% Increase (Decrease)				% Point  Increase (Decrease)
	Operating Revenues		Operating Income		Operating Margins		Operating Revenues		Operating Income		Operating Margins
Base business:
Revenue change/Operating leverage	1.7	%	4.6	%	0.4	%	7.5	%	21.0	%	1.9	%
Changes in variable margins and overhead costs	—		4.4		0.7		—		(4.9	)	(0.7	)
	1.7		9.0		1.1		7.5		16.1		1.2
Acquisitions	3.1		0.6		(0.4	)	4.9		2.3		(0.4	)
Divestitures	(1.4	)	(0.9	)	0.1		(0.1	)	—		—
Restructuring costs	—		(1.9	)	(0.3	)	—		(0.6	)	(0.1	)
Impairment of goodwill and intangibles	—		(0.1	)	—		—		—		—
Translation	(2.7	)	(2.5	)	—		3.1		3.4		0.1
Other	0.1		—		—		—		—		—
	0.8	%	4.2	%	0.5	%	15.4	%	21.2	%	0.8	%

Operating Revenues

Revenues increased 0.8% in 2012 versus 2011 primarily due to higher base revenues and revenues from acquisitions, partially offset by the unfavorable effect of currency translation and the reduction of revenues due to divestitures. Base revenues increased 1.7% in 2012 versus 2011 as North American economic conditions were stronger than the European and Asia Pacific economic environments. North American base revenues increased 4.3% in 2012 versus 2011. International base revenues decreased 1.1% as Europe decreased 2.3% in 2012 versus 2011 primarily driven by weakness in Southern Europe. Asia Pacific base revenues increased 1.3% in 2012 versus 2011 primarily due to growth in India. Acquisitions contributed 3.1% to revenues primarily due to the purchase of a manufacturer of specialty devices used to measure the flow of gases and fluids in the first quarter of 2012 and a thermal processing and environmental equipment manufacturer purchased in the third quarter of 2011. Currency translation resulted in a 2.7% decline in revenues primarily due to a weaker Euro versus the year ago period. Divestitures reduced revenues by 1.4% primarily due to only ten months of operating results for the Decorative Surfaces segment in 2012 versus twelve months of operating results in 2011 as the Company divested a 51% interest in the Decorative Surfaces segment on October 31, 2012, and the segment was deconsolidated as of that date.

Revenues increased 15.4% in 2011 versus 2010 primarily due to higher base revenues, revenues from acquisitions, and the favorable impact of currency translation. Base revenues increased 7.5% in 2011 versus 2010 as worldwide economic conditions strengthened. North American and international base revenues increased 8.7% and 6.1%, respectively, in 2011 versus 2010. Base revenues in Europe and Asia Pacific increased 5.9% and 5.4%, respectively, in 2011 versus 2010; however, European economic conditions slowed in the second half of the year. End markets associated with welding, transportation and test and measurement businesses showed strength in 2011. Acquisitions contributed 4.9% to revenues primarily due to a North American automotive aftermarket business purchased in the first quarter of 2011, a South American chemical products manufacturer purchased in the fourth quarter of 2010, and a North American packaging business purchased in the second quarter of 2011. Currency translation resulted in a 3.1% increase in revenues primarily due to a stronger Euro and Australian dollar versus the year ago period.

Operating Income

Operating income increased 4.2% in 2012 versus 2011 primarily due to the positive operating leverage effects of the base revenue increase noted above and improved variable margins. Currency translation resulted in a 2.5% decline in operating income primarily due to a weaker Euro versus the year ago period. Higher restructuring expenses due to increased cost reduction activities also negatively impacted operating income by 1.9%. Base margins increased 110 basis points primarily due to improved variable margins and the positive operating leverage effect of the increase in base revenues noted above. Changes in variable margins and overhead costs improved base margins 70 basis points primarily due to the favorable effect of selling

17

price versus material cost comparisons of 50 basis points and benefits of restructuring projects. The increase in base margins was partially offset by a 40 basis point decline related to acquisitions, primarily due to amortization expense related to intangible assets. Restructuring expenses diluted total operating margins by 30 basis points primarily due to restructuring activities related to continued improvements in operating structure and efficiencies.

Operating income increased 21.2% in 2011 versus 2010 primarily due to the positive operating leverage effects of the base revenue increase noted above, the favorable effect of currency translation and income from acquisitions, partially offset by weaker variable margins. Currency translation resulted in a 3.4% increase in operating income primarily due to a stronger Euro and Australian dollar versus the year ago period. Base margins increased 120 basis points due to the positive operating leverage effect of the increase in base revenues, partially offset by changes in variable margins and overhead costs of 70 basis points, which was primarily due to the negative impact of selling price versus material cost comparisons of 60 basis points. Acquisitions diluted total operating margins by 40 basis points primarily due to amortization expense related to intangible assets.

RESULTS OF OPERATIONS BY SEGMENT

The reconciliation of segment operating revenues and operating income to total operating revenues and operating income is as follows:

	Operating Revenues
In millions	2012			2011			2010
Transportation	$	3,550		$	3,444		$	2,839
Power Systems & Electronics	3,151			2,988			2,518
Industrial Packaging	2,412			2,463			2,123
Food Equipment	1,939			1,985			1,860
Construction Products	1,902			1,959			1,753
Polymers & Fluids	1,230			1,250			1,001
All Other	2,883			2,690			2,407
Intersegment revenues	(64		)	(76		)	(77		)
Total Segments	17,003			16,703			14,424
Decorative Surfaces	921			1,084			992
Total	$	17,924		$	17,787		$	15,416

	Operating Income
In millions	2012		2011		2010
Transportation	$	560	$	539	$	427
Power Systems & Electronics	643		605		493
Industrial Packaging	282		249		208
Food Equipment	324		304		255
Construction Products	200		225		192
Polymers & Fluids	195		188		167
All Other	521		489		395
Total Segments	2,725		2,599		2,137
Decorative Surfaces	122		132		117
Total	$	2,847	$	2,731	$	2,254

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TRANSPORTATION

Businesses in this segment produce components, fasteners, fluids and polymers, as well as truck remanufacturing and related parts and service.

In the Transportation segment, products and services include:

• plastic and metal components, fasteners and assemblies for automobiles, light trucks and other industrial uses;

• fluids, polymers and other supplies for auto aftermarket maintenance and appearance;

• fillers and putties for auto body repair;

• polyester coatings and patch and repair products for the marine industry; and

• truck remanufacturing and related parts and service.

In 2012, this segment primarily served the automotive original equipment manufacturers and tiers (53%) and automotive aftermarket (31%) markets.

The results of operations for the Transportation segment for 2012, 2011 and 2010 were as follows:

Dollars in millions	2012			2011			2010
Operating revenues	$	3,550		$	3,444		$	2,839
Operating income	560			539			427
Margin %	15.8		%	15.7		%	15.0		%

In 2012 and 2011, the changes in revenues, operating income and operating margins over the prior year were primarily due to the following factors:

	2012 Compared to 2011						2011 Compared to 2010
	% Increase (Decrease)				% Point  Increase (Decrease)		% Increase (Decrease)				% Point  Increase (Decrease)
	Operating Revenues		Operating Income		Operating Margins		Operating Revenues		Operating Income		Operating Margins
Base business:
Revenue change/Operating leverage	3.5	%	8.0	%	0.7	%	9.7	%	23.3	%	1.9	%
Changes in variable margins and overhead costs	—		(0.9	)	(0.2	)	—		(6.0	)	(0.8	)
	3.5		7.1		0.5		9.7		17.3		1.1
Acquisitions and divestitures	2.4		1.5		(0.1	)	9.2		7.4		(0.3	)
Restructuring costs	—		(1.5	)	(0.2	)	—		(1.5	)	(0.2	)
Impairment of goodwill and intangibles	—		—		—		—		—		—
Translation	(2.8	)	(3.3	)	(0.1	)	2.4		3.0		0.1
Other	—		—		—		—		—		—
	3.1	%	3.8	%	0.1	%	21.3	%	26.2	%	0.7	%

Operating Revenues

Revenues increased 3.1% in 2012 versus 2011 primarily due to the increase in base business and revenues from acquisitions, partially offset by the unfavorable effect of currency translation. Worldwide automotive base revenues increased 9.4% in 2012 versus 2011 primarily due to an increase in worldwide auto builds of approximately 6%, favorable customer mix and product penetration gains in Europe, and growing product penetration with automotive original equipment manufacturers in China. The automotive aftermarket base business declined 4.1% in 2012 versus 2011 primarily due to the loss of a major product line with a key customer and decreased demand for car care products in Europe, partially offset by higher demand in the U.S. Base revenues for the truck remanufacturing and related parts and service business increased 4.0% over the prior year primarily due to strong energy development activity that increased consumer demand in North America. The increase in acquisition revenue was primarily due to the purchase of a North American automotive aftermarket business in the first quarter of 2011 and a European automotive aftermarket business in the third quarter of 2011.

19

Revenues increased 21.3% in 2011 versus 2010 primarily due to the increase in base business, revenues from acquisitions and the favorable effect of currency translation. Worldwide automotive base revenues increased 10.3% in 2011 versus 2010 primarily due to an increase in worldwide auto builds of 3% and improved product penetration in European and Asian markets. The truck remanufacturing and related parts and service business increased 19.7% over the prior year due to increased demand in North America and Canada related to oil and gas exploration. Automotive aftermarket base business increased 3.7% over the prior year. The increase in acquisition revenue was primarily due to the purchase of a North American automotive aftermarket business in the first quarter of 2011.

Operating Income

Operating income increased 3.8% in 2012 versus 2011 primarily due to the positive operating leverage effect of the base revenue increase noted above and income from acquisitions, partially offset by the unfavorable effect of currency translation and higher restructuring expenses. Base margins increased 50 basis points primarily due to the positive operating leverage effect of the increase in base revenues described above, partially offset by changes in variable margins and overhead costs. Improvements in variable margins were primarily due to the favorable impact of selling price versus material cost comparisons of 40 basis points, which were more than offset by higher overhead costs of 60 basis points, including costs related to business expansion in China. The increase in total base margins was partially offset by a 20 basis point operating margin decline due to the higher restructuring expenses noted above.

Operating income increased 26.2% in 2011 versus 2010 primarily due to the positive operating leverage effects of the base revenue increase noted above, income from acquisitions and the favorable effect of currency translation, partially offset by lower variable margins and higher overhead costs. Base margins increased 110 basis points primarily due to the positive operating leverage effect of the increase in base revenues described above, partially offset by the negative impact of selling price versus material cost comparisons of 80 basis points. Acquisitions diluted total operating margins by 30 basis points primarily due to amortization expense related to intangible assets.

POWER SYSTEMS & ELECTRONICS

Businesses in this segment produce equipment and consumables associated with specialty power conversion, metallurgy and electronics.

In the Power Systems & Electronics segment, products include:

• arc welding equipment;

• metal arc welding consumables and related accessories;

• metal solder materials for PC board fabrication;

• equipment and services for microelectronics assembly;

• electronic components and component packaging;

• static and contamination control equipment;

• airport ground support equipment;

• pressure sensitive adhesives and components for telecommunications, electronics, medical and transportation applications; and

• metal jacketing and other insulation products.

In 2012, this segment primarily served the general industrial (43%), electronics (17%) and construction (8%) markets.

The results of operations for the Power Systems & Electronics segment for 2012, 2011 and 2010 were as follows:

Dollars in millions	2012			2011			2010
Operating revenues	$	3,151		$	2,988		$	2,518
Operating income	643			605			493
Margin %	20.4		%	20.2		%	19.6		%

20

In 2012 and 2011, the changes in revenues, operating income and operating margins over the prior year were primarily due to the following factors:

	2012 Compared to 2011						2011 Compared to 2010
	% Increase (Decrease)				% Point  Increase (Decrease)		% Increase (Decrease)				% Point  Increase (Decrease)
	Operating Revenues		Operating Income		Operating Margins		Operating Revenues		Operating Income		Operating Margins
Base business:
Revenue change/Operating leverage	3.8	%	7.6	%	0.8	%	12.0	%	24.9	%	2.2	%
Changes in variable margins and overhead costs	—		1.5		0.3		—		(2.7	)	(0.5	)
	3.8		9.1		1.1		12.0		22.2		1.7
Acquisitions and divestitures	3.0		(0.7	)	(0.7	)	4.3		(1.0	)	(0.9	)
Restructuring costs	—		(1.2	)	(0.2	)	—		(0.6	)	(0.1	)
Impairment of goodwill and intangibles	—		(0.1	)	—		—		—		—
Translation	(1.3	)	(0.9	)	—		2.4		2.1		(0.1	)
Other	—		—		—		—		—		—
	5.5	%	6.2	%	0.2	%	18.7	%	22.7	%	0.6	%

Operating Revenues

Revenues increased 5.5% in 2012 versus 2011 due to growth in base business and revenues from acquisitions, partially offset by the unfavorable effect of currency translation. Worldwide welding base revenues increased 6.8% in 2012 versus 2011, but softened in the fourth quarter, as worldwide revenues declined 1.2% in the fourth quarter, largely due to an 11.7% decline in the international welding base business. North American welding base revenues increased 10.2% in 2012 versus 2011 due to growth in oil and gas end markets for the full year and increased sales to heavy equipment OEM's in the first half of 2012, with slowed growth in heavy equipment OEM demand in the second half of the year. Base revenues for the international welding businesses decreased 2.1% in 2012 versus 2011 primarily due to a weak Chinese shipbuilding end market, partially offset by growth in Asian and European oil and gas markets. Base revenues for the electronics businesses increased 0.5% mainly due to base revenue growth of 8.0% in the electronics assembly businesses driven by strong order rates from a key electronics customer, partially offset by a 4.1% decline in the other electronics businesses as consumer demand for basic cell phones and computers was weaker. Acquisition revenue was primarily due to the purchase of a thermal processing and environmental equipment manufacturer in the third quarter of 2011.

Revenues increased 18.7% in 2011 versus 2010 due to growth in base business, revenues from acquisitions and the favorable effect of currency translation. Worldwide welding base revenues increased 19.5% in 2011 versus 2010. North American welding base revenues increased 22.4% due to improvements in a number of industrial-based end markets. In particular, increased sales in the oil and gas end market as well as sales to heavy equipment OEM’s and other manufacturers helped drive base revenues. Base revenues for the international welding businesses increased 11.9% in 2011 versus 2010 primarily due to growth in European and Asian oil and gas and infrastructure-related end markets. Base revenues for the electronics businesses increased 1.3% mainly due to base revenue growth of 6.3% in the electronics assembly businesses, though end markets significantly slowed for these businesses in the fourth quarter of 2011. Base revenues for the other electronics businesses decreased 1.3% due to weakening end markets and softer consumer demand. Acquisition revenue was primarily due to the purchase of a thermal processing and environmental equipment manufacturer in the third quarter of 2011 and an automated welding systems business in the fourth quarter of 2010.

Operating Income

Operating income increased 6.2% in 2012 versus 2011 primarily due to the favorable operating leverage effect of the growth in base revenues and improved variable margins, partially offset by higher restructuring expenses due to increased cost reduction activities and the unfavorable impact of currency translation. Base margins increased 110 basis points in 2012 versus 2011 primarily due to the favorable operating leverage effect of the growth in base business of 80 basis points and changes in variable margins and overhead costs. The changes in variable margins and overhead costs increased base margins by 30 basis points primarily due to the positive impact of selling price versus material cost comparisons of 90 basis points, partially offset by higher overhead costs, including investments in emerging markets related to the oil and gas businesses. Acquisitions diluted

21

total operating margins by 70 basis points in 2012 versus 2011 primarily due to lower operating margins and the impact of intangible asset amortization from acquisitions made within the past year.

Operating income increased 22.7% in 2011 versus 2010 primarily due to the favorable operating leverage effect of the growth in base revenues and the favorable impact of currency translation, partially offset by lower variable margins. Base margins increased 170 basis points primarily due to the favorable operating leverage effect of the growth in base revenues, partially offset by the negative impact of selling price versus material cost comparisons of 40 basis points. Acquisitions diluted total operating margins by 90 basis points versus the prior year, primarily due to the impact of intangible asset amortization.

INDUSTRIAL PACKAGING

Businesses in this segment produce steel, plastic and paper products and equipment used for bundling, shipping and protecting goods in transit.

In the Industrial Packaging segment, products include:

• steel and plastic strapping and related tools and equipment;

• plastic stretch film and related equipment; and

• paper and plastic products that protect goods in transit.

In 2012, this segment primarily served the general industrial (27%), primary metals (22%), food and beverage (10%) and construction (9%) markets.

The results of operations for the Industrial Packaging segment for 2012, 2011 and 2010 were as follows:

Dollars in millions	2012			2011			2010
Operating revenues	$	2,412		$	2,463		$	2,123
Operating income	282			249			208
Margin %	11.7		%	10.1		%	9.8		%

In 2012 and 2011, the changes in revenues, operating income and operating margins over the prior year were primarily due to the following factors:

	2012 Compared to 2011						2011 Compared to 2010
	% Increase (Decrease)				% Point  Increase (Decrease)		% Increase (Decrease)				% Point  Increase (Decrease)
	Operating Revenues		Operating Income		Operating Margins		Operating Revenues		Operating Income		Operating Margins
Base business:
Revenue change/Operating leverage	0.4	%	1.6	%	0.1	%	9.2	%	36.9	%	2.5	%
Changes in variable margins and overhead costs	—		16.4		1.7		—		(23.0	)	(2.1	)
	0.4		18.0		1.8		9.2		13.9		0.4
Acquisitions and divestitures	1.4		1.3		—		3.0		3.1		—
Restructuring costs	—		(1.3	)	(0.1	)	—		(2.5	)	(0.2	)
Impairment of goodwill and intangibles	—		—		—		—		—		—
Translation	(3.8	)	(4.6	)	(0.1	)	3.8		5.2		0.1
Other	—		—		—		—		—		—
	(2.0	)%	13.4	%	1.6	%	16.0	%	19.7	%	0.3	%

Operating Revenues

Revenues decreased 2.0% in 2012 versus 2011 due to the unfavorable effect of currency translation, which more than offset revenues from acquisitions and an increase in base revenues. The increase in acquisition revenue was primarily due to the purchase of a European protective packaging business in the fourth quarter of 2011 and a North American protective packaging business in the second quarter of 2011. Total North American base revenues increased 3.4% in 2012 versus 2011, while international base revenues declined 1.9% over the same period. Base revenues were virtually flat for the North American

22

strapping and equipment businesses due to unfavorable selling prices and lower equipment sales, partially offset by increased sales volume in steel and plastic strapping. Base revenues for the international strapping and equipment businesses decreased 3.4%, primarily due to a slowdown in consumable sales in the European steel and lumber markets. Worldwide stretch packaging base revenues increased 4.9% in 2012 versus 2011 primarily due to increased equipment sales in North America and Europe and consumable sales to agricultural customers in Europe, while worldwide protective packaging grew 3.2% over the same period primarily due to increased product penetration.

Revenues increased 16.0% in 2011 versus 2010 due to the increase in base revenues, the favorable effect of currency translation and revenues from acquisitions. Base revenues for the North American strapping and equipment businesses increased 11.6% in 2011 versus 2010 largely due to higher steel and plastic strapping prices and increased equipment sales. Base revenues for the international strapping and equipment businesses grew 7.0% primarily due to higher strapping prices and higher equipment sales. Base revenues for stretch packaging worldwide increased 14.0% in 2011 versus 2010 and worldwide protective packaging grew 7.9% over the prior period. The increase in acquisition revenue was primarily due to the purchase of a protective packaging business in the second quarter of 2011.

Operating Income

Operating income increased 13.4% in 2012 versus 2011 primarily due to lower operating expenses, partially offset by the unfavorable impact of currency translation. Base operating margins increased 180 basis points primarily due to changes in variable margins and overhead costs. The changes in variable margins and overhead costs increased base margins by 170 basis points primarily due to the positive impact of selling price versus material cost comparisons of 70 basis points, the benefits of restructuring projects, primarily within the strapping business, and other overhead cost reductions.

Operating income increased 19.7% in 2011 versus 2010 primarily due to the increase in base revenues, the favorable impact of currency translation and income from acquisitions, partially offset by lower variable margins and higher restructuring expenses. Base operating margins increased 40 basis points primarily due to the positive operating leverage effect of the increase in base revenues of 250 basis points, partially offset by changes in variable margins and overhead costs. The changes in variable margins and overhead costs decreased base margins by 210 basis points, primarily due to unfavorable selling price versus material cost comparisons of 110 basis points and higher operating expenses in North America.

FOOD EQUIPMENT

Businesses in this segment produce commercial food equipment and provide related service.

In the Food Equipment segment, products and services include:

• warewashing equipment;

• cooking equipment, including ovens, ranges and broilers;

• refrigeration equipment, including refrigerators, freezers and prep tables;

• food processing equipment, including slicers, mixers and scales;

• kitchen exhaust, ventilation and pollution control systems; and

• food equipment service, maintenance and repair.

In 2012, this segment primarily served the food institutional/restaurant (42%), service (38%) and food retail (16%) markets.

The results of operations for the Food Equipment segment for 2012, 2011 and 2010 were as follows:

Dollars in millions	2012			2011			2010
Operating revenues	$	1,939		$	1,985		$	1,860
Operating income	324			304			255
Margin %	16.7		%	15.3		%	13.7		%

23

In 2012 and 2011, the changes in revenues, operating income and operating margins over the prior year were primarily due to the following factors:

	2012 Compared to 2011						2011 Compared to 2010
	% Increase (Decrease)				% Point  Increase (Decrease)		% Increase (Decrease)				% Point  Increase (Decrease)
	Operating Revenues		Operating Income		Operating Margins		Operating Revenues		Operating Income		Operating Margins
Base business:
Revenue change/Operating leverage	0.6	%	1.7	%	0.2	%	2.8	%	8.9	%	0.8	%
Changes in variable margins and overhead costs	—		8.3		1.2		—		10.6		1.4
	0.6		10.0		1.4		2.8		19.5		2.2
Acquisitions and divestitures	—		—		—		1.2		(0.4	)	(0.2	)
Restructuring costs	—		—		—		—		(3.0	)	(0.4	)
Impairment of goodwill and intangibles	—		(0.3	)	—		—		—		—
Translation	(2.9	)	(3.0	)	—		2.7		3.0		—
Other	—		—		—		—		—		—
	(2.3	)%	6.7	%	1.4	%	6.7	%	19.1	%	1.6	%

Operating Revenues

Revenues decreased 2.3% in 2012 versus 2011 due to the unfavorable effect of currency translation, which more than offset the growth in base business. North American base revenues increased 3.0% in 2012 versus 2011 as equipment revenues increased 2.7% and service revenues increased 3.6%. The increase in equipment revenues was driven by growth in certain institutional, restaurant and retail markets, but declined in the fourth quarter of 2012, largely due to slower demand from institutional customers in budget constrained sectors. The increase in service revenues was partly due to expanded service capabilities and improved market penetration. International base revenues decreased 2.0% in 2012 versus 2011 as equipment revenues decreased 4.2%, driven by lower European sales in the cooking businesses, partially offset by product penetration gains in China and Brazil. International service revenues increased 3.4% driven by sales in Europe due to expanded service capabilities.

Revenues increased 6.7% in 2011 versus 2010 due to the growth in base business, the favorable effect of currency translation and revenues from acquisitions. North American food equipment base revenues increased 3.9% in 2011 versus 2010 as equipment revenues increased 4.6% and service revenues grew 2.7%. Equipment revenues increased primarily due to better, but still modest growth in the casual dining restaurant category, partially offset by weakness in institutional categories where government budgets were constrained. International base revenues increased 1.7% for the period as equipment revenues increased 1.0% and service revenues increased 3.3%. Growth in Asian and Latin American revenues was partially offset by lower European sales in 2011 versus 2010. The increase in acquisition revenue was primarily due to the purchase of a European food equipment business in the third quarter of 2010.

Operating Income

Operating income increased 6.7% in 2012 versus 2011 primarily due to improved variable margins and productivity improvements, partially offset by the unfavorable effect of currency translation. Base operating margins increased 140 basis points primarily due to changes in variable margins and overhead costs. The changes in variable margins and overhead costs increased base margins by 120 basis points in 2012 versus 2011, primarily due to the positive impact of selling price versus material cost comparisons of 60 basis points and a 50 basis point improvement from lower operating expenses due to productivity improvements in North America and Europe.

Operating income increased 19.1% in 2011 versus 2010 primarily due to lower operating expenses, the increase in base revenues and the favorable effect of currency translation, partially offset by higher restructuring expenses. Base business margins increased 220 basis points primarily due to lower operating expenses and adjustments related to a European business in 2010, and the positive operating leverage effect of the increase in base revenues of 80 basis points noted above. Higher restructuring expenses in 2011 versus 2010 decreased total operating margins by 40 basis points.

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CONSTRUCTION PRODUCTS

Businesses in this segment produce construction fastening systems and truss products.

In the Construction Products segment, products include:

• fasteners and related fastening tools for wood and metal applications;

• anchors, fasteners and related tools for concrete applications;

• metal plate truss components and related equipment and software; and

• packaged hardware, fasteners, anchors and other products for retail.

In 2012, this segment primarily served the residential construction (44%), renovation construction (26%), and commercial construction (25%) markets.

The results of operations for the Construction Products segment for 2012, 2011 and 2010 were as follows:

Dollars in millions	2012			2011			2010
Operating revenues	$	1,902		$	1,959		$	1,753
Operating income	200			225			192
Margin %	10.5		%	11.5		%	11.0		%

In 2012 and 2011, the changes in revenues, operating income and operating margins over the prior year were primarily due to the following factors:

	2012 Compared to 2011						2011 Compared to 2010
	% Increase (Decrease)				% Point  Increase (Decrease)		% Increase (Decrease)				% Point  Increase (Decrease)
	Operating Revenues		Operating Income		Operating Margins		Operating Revenues		Operating Income		Operating Margins
Base business:
Revenue change/Operating leverage	(0.5	)%	(1.9	)%	(0.2	)%	2.7	%	10.7	%	0.9	%
Changes in variable margins and overhead costs	—		(0.7	)	—		—		(7.4	)	(0.8	)
	(0.5	)	(2.6	)	(0.2	)	2.7		3.3		0.1
Acquisitions and divestitures	0.2		1.8		0.2		3.0		0.1		(0.3	)
Restructuring costs	—		(8.4	)	(1.0	)	—		4.4		0.5
Impairment of goodwill and intangibles	—		—		—		—		—		—
Translation	(2.6	)	(2.1	)	—		6.0		9.5		0.3
Other	—		—		—		—		0.1		(0.1	)
	(2.9	)%	(11.3	)%	(1.0	)%	11.7	%	17.4	%	0.5	%

Operating Revenues

Revenues decreased 2.9% in 2012 versus 2011 primarily due to the negative impact of currency translation and lower base revenues. International base revenues declined 3.4% in 2012 versus 2011 as European base revenues declined 5.1% due to lower sales of consumable products driven by a slowdown in construction activity in all European end markets. Base revenues in Asia Pacific declined 1.4% in 2012 versus 2011 primarily due to lower renovation and commercial construction activity in Australia and New Zealand. In North America, base revenue growth for residential, renovation and commercial construction was 9.5%, 5.6% and 4.1%, respectively. The North American base revenue increase was driven by improved U.S. housing starts as well as a modest increase in commercial construction square footage activity.

Revenues increased 11.7% in 2011 versus 2010 primarily due to the favorable effect of currency translation, revenues from acquisitions and an increase in base revenues. The increase in acquisition revenue was primarily due to the purchase of a European retail distribution business in the second quarter of 2010 and a North American fastener business in the second quarter of 2011. European base revenues increased 7.2% due to improved conditions in commercial construction in the first half of the year; however, the rate of growth moderated in the second half of the year compared to early 2011. North American base revenues increased 2.3% primarily due to price increases implemented to offset higher steel prices, partially offset by the one-time licensing agreement settlement in the commercial construction business that positively impacted revenues in 2010. In

25

North America, renovation base revenue growth was 5.5%, residential base revenue growth was 2.7% and commercial construction base revenue declined 3.0%. North American base revenue was impacted by 1% growth in remodeling expenditures, 3% annualized growth in U.S. housing starts as well as a 2% decline in commercial construction square footage activity. Base revenues for the Asia-Pacific region declined 1.7% as market conditions in the Australian residential construction market progressively softened throughout the year.

Operating Income

Operating income decreased 11.3% in 2012 versus 2011 primarily due to higher restructuring expenses, the unfavorable impact of currency translation and lower base revenues, partially offset by income from acquisitions. Total base margins decreased 20 basis points in 2012 versus 2011 due to the negative operating leverage effect of the decrease in base revenues. The impact of changes in variable margins and overhead costs on total base margins was flat in 2012 versus 2011, as the favorable impact of selling price versus material cost comparisons of 20 basis points was offset by higher operating expenses in Europe. Restructuring expenses reduced total operating margins by 100 basis points due to increased cost reduction activities worldwide.

Operating income increased 17.4% in 2011 versus 2010 primarily due to the positive operating leverage effect from the increase in base revenues described above, the favorable effect of currency translation, and lower restructuring expenses. Base margins increased 10 basis points versus the prior year primarily due to the favorable operating leverage effect of the increase in base revenues, partially offset by a one-time licensing agreement settlement in the commercial construction business that favorably affected margins in 2010, and the negative impact of selling price versus material cost comparisons of 30 basis points.

POLYMERS & FLUIDS

Businesses in this segment produce adhesives, sealants, lubrication and cutting fluids, and hygiene products.

In the Polymers & Fluids segment, products include:

• adhesives for industrial, construction and consumer purposes;

• chemical fluids which clean or add lubrication to machines;

• epoxy and resin-based coating products for industrial applications; and

• hand wipes and cleaners for industrial applications.

In 2012, this segment primarily served the general industrial (33%), construction (14%) and maintenance, repair and operations, or "MRO", (18%) markets.

The results of operations for the Polymers & Fluids segment for 2012, 2011 and 2010 were as follows:

Dollars in millions	2012			2011			2010
Operating revenues	$	1,230		$	1,250		$	1,001
Operating income	195			188			167
Margin %	15.8		%	15.0		%	16.7		%

26

In 2012 and 2011, the changes in revenues, operating income and operating margins over the prior year were primarily due to the following factors:

	2012 Compared to 2011						2011 Compared to 2010
	% Increase (Decrease)				% Point Increase (Decrease)		% Increase (Decrease)				% Point Increase (Decrease)
	Operating Revenues		Operating Income		Operating Margins		Operating Revenues		Operating Income		Operating Margins
Base business:
Revenue change/Operating leverage	(3.1	)%	(9.0	)%	(0.9	)%	4.7	%	12.4	%	1.2	%
Changes in variable margins and overhead costs	—		16.9		2.6		—		(9.2	)	(1.4	)
	(3.1	)	7.9		1.7		4.7		3.2		(0.2	)
Acquisitions and divestitures	6.1		1.2		(0.8	)	16.2		8.7		(0.9	)
Restructuring costs	—		(1.2	)	(0.2	)	—		(3.5	)	(0.6	)
Impairment of goodwill and intangibles	—		—		—		—		—		—
Translation	(4.6	)	(4.2	)	0.1		4.0		4.2		—
Other	—		—		—		—		—		—
	(1.6	)%	3.7	%	0.8	%	24.9	%	12.6	%	(1.7	)%

Operating Revenues

Revenues decreased 1.6% in 2012 versus 2011 primarily due to the negative effect of currency translation and a decrease in base revenues, partially offset by revenues from acquisitions. Worldwide base revenues for the polymers and hygiene businesses decreased 4.0% in 2012 versus 2011 primarily driven by a decrease in European sales, especially in Spain, and from exiting low margin business. Worldwide base revenues for the fluids business decreased 1.4% in 2012 versus 2011 primarily due to decreased sales in Europe, partially offset by modest growth in North America and Brazil. The increase in acquisition revenue was primarily due to the purchase of a manufacturer of advanced technology silicone materials in the second quarter of 2012 and a European specialty chemical business in the first quarter of 2012.

Revenues increased 24.9% in 2011 versus 2010 primarily due to revenues from acquisitions, an increase in base revenues and the favorable effect of currency translation. Acquisition revenue was primarily the result of the purchase of a Latin American fluids business and a European polymers business in the fourth quarter of 2010. End market demand was stronger in North America and Asia Pacific but weaker in Europe. Total base revenues for the polymers businesses increased 2.7% while the fluids businesses increased 6.2% in 2011 versus 2010. North American base revenues increased 7.4% and European base revenues increased 3.2%, while Asia-Pacific base revenues increased 5.0% primarily due to growth in China.

Operating Income

Operating income increased 3.7% in 2012 versus 2011 primarily due to improvements in variable margins and income from acquisitions, partially offset by the decrease in base revenues noted above, the unfavorable effect of currency translation, and higher restructuring expenses. Total base margins increased 170 basis points versus last year primarily due to changes in variable margins and overhead costs of 260 basis points, partially offset by the impact of the decrease in base revenues noted above. The positive impact from changes in variable margins and overhead costs was primarily due to the favorable impact of selling price versus material cost comparisons of 90 basis points, lower overhead costs of 110 basis points primarily due to the benefits of restructuring projects, and the loss on an international polymers contract that negatively impacted margins in 2011. Acquisitions diluted total operating margins by 80 basis points primarily due to the impact of intangible asset amortization from acquisitions made within the past year.

Operating income increased 12.6% in 2011 versus 2010 primarily due to the increase in base revenues, income from acquisitions and the favorable effect of currency translation, partially offset by higher operating costs and restructuring expenses. Base margins declined 20 basis points versus the prior year primarily due to the negative impact of selling price versus material cost comparisons of 90 basis points and a loss on an international polymers contract, partially offset by the positive operating leverage effect of the increase in base revenues. Acquisitions diluted total operating margins by 90 basis points primarily due to the impact of intangible asset amortization.

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ALL OTHER

This segment includes all other operating segments.

In the All Other segment, products include:

• equipment and related software for testing and measuring of materials, structures, gases and fluids;

• plastic reclosable packaging for consumer food storage;

• plastic consumables that multi-pack cans and bottles and related equipment;

• plastic and metal fasteners and components for appliances;

• foil, film and related equipment used to decorate consumer products;

• product coding and marking equipment and related consumables; and

• line integration, conveyor systems and line automation for the food and beverage industries.

In 2012, this segment primarily served the general industrial (27%), food and beverage (21%), consumer durables (12%), and food retail/service (4%) markets.

The results of operations for the All Other segment for 2012, 2011 and 2010 were as follows:

Dollars in millions	2012			2011			2010
Operating revenues	$	2,883		$	2,690		$	2,407
Operating income	521			489			395
Margin %	18.1		%	18.2		%	16.4		%

In 2012 and 2011, the changes in revenues, operating income and operating margins over the prior year were primarily due to the following factors:

	2012 Compared to 2011						2011 Compared to 2010
	% Increase (Decrease)				% Point  Increase (Decrease)		% Increase (Decrease)				% Point  Increase (Decrease)
	Operating Revenues		Operating Income		Operating Margins		Operating Revenues		Operating Income		Operating Margins
Base business:
Revenue change/Operating leverage	2.9	%	7.2	%	0.7	%	6.9	%	19.3	%	1.9	%
Changes in variable margins and overhead costs	—		4.9		0.9		—		1.1		0.2
	2.9		12.1		1.6		6.9		20.4		2.1
Acquisitions and divestitures	6.5		(0.9	)	(1.3	)	2.9		1.0		(0.3	)
Restructuring costs	—		(2.2	)	(0.4	)	—		—		—
Impairment of goodwill and intangibles	—		—		—		—		0.3		—
Translation	(2.2	)	(2.3	)	—		2.0		2.1		—
Other	—		—		—		—		—		—
	7.2	%	6.7	%	(0.1	)%	11.8	%	23.8	%	1.8	%

Operating Revenues

Revenues increased 7.2% in 2012 versus 2011 due to revenues from acquisitions and an increase in base business, partially offset by the unfavorable effect of currency translation. Acquisition revenue was primarily due to the first quarter 2012 purchase of a manufacturer of specialty devices used to measure the flow of gases and fluids. Base revenues increased 7.2% for the worldwide test and measurement businesses primarily due to increased equipment orders in North America, Europe, and China, and a one-time sale of equipment to a consumer electronics customer. Base revenues for the consumer packaging businesses were virtually flat as increased sales in both the global packaging solutions business and plastics and security business were offset by lower sales related to the reclosable packaging business and the worldwide foils and transfer ribbon business. Worldwide appliance base revenue growth was 8.0% primarily due to market penetration and improved customer demand in North America in 2012 versus 2011.

Revenues increased 11.8% in 2011 versus 2010 due to an increase in base business revenues, revenues from acquisitions and

28

the favorable effect of currency translation. Acquisition revenue was primarily due to the purchase of a test and measurement business in the fourth quarter of 2010, a heat transfer business in the second quarter of 2011, and a plastics and security business in the second quarter of 2010. Base business revenues for the test and measurement businesses increased 15.5% due to increased equipment orders both internationally and in North America. Growing worldwide product regulatory standards contributed to growth in these businesses. Base revenues for the consumer packaging business increased 4.7% in 2011 versus 2010 due to growth in the beverage packaging solutions, decorating equipment and marking and labels businesses. Base revenues for the worldwide appliance businesses declined 9.1% due to prolonged construction-associated weakness in the appliance end market.

Operating Income

Operating income increased 6.7% in 2012 versus 2011 primarily due to the growth in base revenues and improved variable margins, partially offset by the unfavorable impact of currency translation, higher restructuring expenses, and the loss of income due to divestitures partially offset by income from acquisitions. Total base margins increased 160 basis points primarily due to changes in variable margins and overhead costs of 90 basis points and the increase in base revenues noted above. The positive impact from changes in variable margins and overhead costs was primarily due to favorable selling price versus material cost comparisons of 40 basis points and other variable margin improvements of 40 basis points primarily due to product mix. Acquisitions (net of divestitures) diluted total operating margins by 130 basis points primarily due to amortization expense related to intangible assets from acquisitions made within the past year. Higher restructuring expenses decreased operating margins by 40 basis points due to increased cost reduction activities in 2012.

Operating income increased 23.8% in 2011 versus 2010 primarily due to the growth in base revenues. Base margins increased 210 basis points primarily due to the positive operating leverage effect from the increase in base revenues of 190 basis points and changes in variable margins and overhead costs of 20 basis points. The positive impact from changes in variable margins and overhead costs was primarily due to the benefits from past restructuring projects. Acquisitions (net of divestitures) diluted total operating margins by 30 basis points in 2011.

DECORATIVE SURFACES

The Decorative Surfaces business produces decorative high-pressure laminate surfacing materials for furniture, office and retail space, countertops, worktops and other applications. Principal end markets served include commercial, renovation and residential construction.

On August 15, 2012, the Company entered into the Investment Agreement to divest a 51% majority interest in its Decorative Surfaces segment to certain funds managed by CD&R. Under the terms of the Investment Agreement, the Company contributed the assets and stock of the Decorative Surfaces segment to a newly formed joint venture, Wilsonart. The transaction closed on October 31, 2012, reducing the Company's ownership of Wilsonart to 49% immediately following the close of the transaction. The Company ceased consolidating the results of the Decorative Surfaces segment as of October 31, 2012 and now reports its 49% ownership interest in Wilsonart using the equity method of accounting. Effective November 1, 2012, the Company made changes to its management reporting structure and Decorative Surfaces is no longer a reportable segment of the Company. See the Divestiture of Majority Interest in Decorative Surfaces Segment note in Item 8. Financial Statements and Supplementary Data for further discussion of this transaction.

Historical operating results of Decorative Surfaces for 2012, 2011 and 2010 were as follows:

	For the Ten Months Ended October 31,			For the Twelve Months Ended December 31,
In millions	2012			2011			2010
Operating revenues	$	921		$	1,084		$	992
Operating income	122			132			117
Margin %	13.3		%	12.2		%	11.8		%

Revenues declined 15.0% and operating income decreased 7.5% in 2012 versus 2011 due to there being only ten months of operating results in 2012 versus twelve months of operating results in 2011 as the Company divested a 51% interest in the Decorative Surfaces segment on October 31, 2012.

Revenues increased 9.3% in 2011 versus 2010 primarily due to the increase in base revenues and the favorable effect of currency translation. Operating income increased 12.8% in 2011 versus 2010 primarily due to the increase in base revenues, lower restructuring expenses and the favorable effect of currency translation, partially offset by higher operating costs.

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AMORTIZATION OF INTANGIBLE ASSETS

Amortization of intangible assets increased to $288 million in 2012 from $255 million in 2011, due to newly acquired businesses, most notably a manufacturer of specialty devices used to measure the flow of gases and fluids in the All Other segment acquired in the beginning of 2012. Amortization of intangible assets increased in 2011 versus $207 million in 2010, due to intangible asset amortization for newly acquired businesses, most notably a North American automotive aftermarket business in the Transportation segment and a thermal processing and environmental equipment manufacturer in the Power Systems & Electronics segment.

IMPAIRMENT OF GOODWILL AND OTHER INTANGIBLE ASSETS

In 2012, the Company performed its annual goodwill and indefinite-lived intangible asset impairment assessment, which resulted in a goodwill impairment charge of approximately $1 million related to the pressure sensitive adhesives reporting unit in the Power Systems & Electronics segment and an intangible asset impairment charge of approximately $1 million related to an international reporting unit in the Food Equipment segment. There were no impairment charges in 2011. In 2010, there was an intangible asset impairment charge of approximately $1 million related to the test and measurement reporting unit in the All Other segment. See the Goodwill and Intangible Assets note in Item 8. Financial Statements and Supplementary Data for further details of the impairment charges.

INTEREST EXPENSE

Interest expense increased to $214 million in 2012, which includes the full year impact of interest expense on the 3.375% notes and 4.875% notes issued in late August 2011 and the interest expense related to the 3.9% notes issued in late August 2012, versus $192 million in 2011. The increase was partially offset by lower interest expense on the 6.55% preferred debt securities which were fully paid on the first business day in 2012. Interest expense increased to $192 million in 2011 versus $175 million in 2010 primarily due to interest expense on the 3.375% notes and 4.875% notes issued in late August 2011. The weighted-average interest rate on the Company's commercial paper was 0.2% in 2012, 0.1% in 2011 and 0.2% in 2010.

GAIN ON SALE OF INTEREST IN DECORATIVE SURFACES

In the fourth quarter of 2012, the Company recorded a pre-tax gain of $933 million ($632 million after-tax) related to the sale of a 51% majority interest in the Decorative Surfaces segment. See the Divestiture of Majority Interest in Decorative Surfaces Segment note in Item 8. Financial Statements and Supplementary Data for further discussion of this transaction.

OTHER INCOME (EXPENSE)

Other income (expense) was income of $37 million in 2012 versus $54 million in 2011. This decrease was primarily due to an equity loss related to Wilsonart of $30 million in 2012, lower income from investments of $11 million (versus $17 million in 2011), and losses on foreign currency transactions of $11 million (versus $4 million in 2011), partially offset by gains on the disposal of operations and affiliates of $22 million (versus $2 million in 2011). See the Divestiture of Majority Interest in Decorative Surfaces Segment note in Item 8. Financial Statements and Supplementary Data for further discussion of the Wilsonart transaction.

Other income (expense) was income of $54 million in 2011 versus $10 million in 2010. This increase was primarily due to higher interest income of $40 million (versus $24 million in 2010), lower losses on foreign currency transactions of $4 million (versus $17 million in 2010) and gains on disposal of operations and affiliates of $2 million (versus losses of $8 million in 2010).

INCOME TAXES

The effective tax rate was 30.7% in 2012, 22.2% in 2011, and 30.5% in 2010. The effective tax rate for 2012 was unfavorably impacted by discrete tax charges totaling $36 million in the fourth quarter of 2012, which included $35 million for the settlement of an IRS tax audit for the years 2008-2009. The effective tax rate for 2011 was favorably impacted by the discrete non-cash tax benefit of $166 million in the first quarter of 2011 related to the decision in the Company’s favor by the Federal Court of Australia, Victoria with respect to a significant portion of the income tax deductions that had been challenged by the Australian Tax Office. The effective tax rate for 2010 was unfavorably impacted by the discrete tax charge of $22 million in the first quarter of 2010 related to the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act.

See the Income Taxes note in Item 8. Financial Statements and Supplementary Data for further details on these discrete tax adjustments and a reconciliation of the U.S. federal statutory rate to the effective tax rate.

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INCOME FROM CONTINUING OPERATIONS

Income from continuing operations in 2012 of $2.5 billion ($5.27 per diluted share) was 23.7% higher than 2011 income of $2.0 billion ($4.08 per diluted share). Income from continuing operations in 2011 was 38.9% higher than 2010 income of $1.5 billion ($2.89 per diluted share).

FOREIGN CURRENCY

The strengthening of the U.S. Dollar against foreign currencies in 2012 versus 2011 decreased operating revenues by approximately $466 million in 2012 and decreased income from continuing operations by approximately $44 million ($0.09 per diluted share). The weakening of the U.S. Dollar against foreign currencies in 2011 versus 2010 increased operating revenues by approximately $460 million in 2011 and increased income from continuing operations by approximately $51 million ($0.10 per diluted share).

INCOME FROM DISCONTINUED OPERATIONS

Income from discontinued operations was $375 million in 2012 versus $54 million in 2011 primarily due to an after-tax gain of $372 million on the sale of the finishing business in the second quarter of 2012. Income from discontinued operations in 2011 was higher than 2010 income of $51 million primarily due to improved operating results in the held for sale finishing business partially offset by an after-tax loss of $3 million on the sale of a discontinued operation in 2011 versus an after-tax gain of $5 million on the sale of a discontinued operation in 2010. See the Discontinued Operations note in Item 8. Financial Statements and Supplementary Data for discussion of the Company’s discontinued operations.

2013 SEGMENT CHANGES

Effective January 1, 2013, the Company made certain changes in how its operations are reported to senior management in order to better align its portfolio of businesses with its enterprise-wide portfolio management initiative.

As a result of this reorganization, the Company's operations will be prospectively aggregated into the following eight external reportable segments: Industrial Packaging; Test & Measurement and Electronics; Automotive OEM; Polymers & Fluids; Food Equipment; Construction Products; Welding; and Specialty Products.

The significant changes resulting from this reorganization include the following:

• Certain businesses within the former Transportation segment, primarily related to the automotive aftermarket business, will be reported in the Polymers & Fluids segment and the Transportation segment will be renamed Automotive OEM.

• The Welding business, which was formerly reported in the Power Systems & Electronics segment, will be reported separately as the Welding segment.

• The Electronics business, which was formerly reported in the Power Systems & Electronics segment, will be combined with the Test & Measurement business, which was formerly reported in the All Other segment, to form a new Test & Measurement and Electronics segment.

• The All Other segment will be renamed Specialty Products.

The 2012 Annual Report on Form 10-K has not been restated for these changes in segment reporting. Results for 2012 and prior periods are reported on the basis under which the Company managed its business in 2012 and do not reflect the January 2013 reorganization described above.

LIQUIDITY AND CAPITAL RESOURCES

The Company’s primary sources of liquidity are free operating cash flows and short-term credit facilities. Management continues to believe that internally generated cash flows will be adequate to service debt, to finance internal growth, to continue to pay dividends, and to fund small to medium-sized acquisitions.

The primary uses of liquidity are:

• dividend payments – the Company’s dividend payout guidelines are 30% to 45% of the average of the last two years’ free operating cash flow;

• acquisitions; and

• share repurchases.

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Cash Flow

The Company uses free operating cash flow to measure cash flow generated by operations that is available for dividends, acquisitions, share repurchases and debt repayment. The Company believes this non-GAAP financial measure is useful to investors in evaluating the Company's financial performance and measures the Company's ability to generate cash internally to fund Company initiatives. Free operating cash flow represents net cash provided by operating activities less additions to plant and equipment. Free operating cash flow is a measurement that is not the same as net cash flow from operating activities per the statement of cash flows and may not be consistent with similarly titled measures used by other companies.

Summarized cash flow information for the three years ended December 31, 2012, 2011 and 2010 was as follows:

In millions	2012			2011			2010
Net cash provided by operating activities	$	2,072		$	1,956		$	1,488
Additions to plant and equipment	(382		)	(353		)	(288		)
Free operating cash flow	$	1,690		$	1,603		$	1,200
Cash dividends paid	$	(865	)	$	(680	)	$	(636	)
Acquisition of businesses (excluding cash and equivalents) and additional interest in affiliates	(723		)	(1,308		)	(497		)
Repurchases of common stock	(2,020		)	(950		)	(350		)
Proceeds from investments	281			37			27
Net proceeds from sale of discontinued operations	723			—			—
Proceeds from sale of operations and affiliates	1,120			22			63
Net proceeds (repayments) of debt	1,015			1,148			(190		)
Other	327			184			146
Effect of exchange rate changes on cash and equivalents	53			(64		)	77
Net increase (decrease) in cash and equivalents	$	1,601		$	(8	)	$	(160	)

On August 20, 2007, the Company’s Board of Directors authorized a stock repurchase program which provided for the buyback of up to $3.0 billion of the Company’s common stock over an open-ended period of time (the “2007 Program”). Under the 2007 Program, the Company made repurchases of approximately 16.3 million shares of its common stock at an average price of $53.51 per share and approximately 8.1 million shares of its common stock at an average price of $43.29 per share during the years ended December 31, 2011 and 2010, respectively. As of December 31, 2011, there were no authorized repurchases remaining under the 2007 Program.

On May 6, 2011, the Company’s Board of Directors authorized a new stock repurchase program which provides for the buyback of up to an additional $4.0 billion of the Company’s common stock over an open-ended period of time (the “2011 Program”). Under the 2011 Program, the Company made repurchases of approximately 1.8 million shares of its common stock at an average price of $43.20 per share during 2011 and approximately 35.5 million shares of its common stock at an average price of $56.93 per share during 2012. As of December 31, 2012, there was approximately $1.9 billion of authorized repurchases remaining under the 2011 Program.

Return on Average Invested Capital

The Company uses return on average invested capital (“ROIC”) to measure the effectiveness of its operations’ use of invested capital to generate profits. ROIC is a non-GAAP financial measure that the Company believes is a meaningful metric to investors in evaluating the Company’s financial performance and may be different than the method used by other companies to calculate ROIC. Invested capital represents the net assets of the Company, excluding cash and equivalents and outstanding debt, which are excluded as they do not represent capital investment in the Company’s operations. Average invested capital is calculated using balances at the start of the period and at the end of each quarter.

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ROIC for the years ended December 31, 2012, 2011, and 2010 was as follows:

Dollars in millions	2012			2011			2010
Operating income	$	2,847		$	2,731		$	2,254
Taxes (30.7% for 2012, 22.2% for 2011, and 30.5% for 2010)	(874		)	(606		)	(687		)
Operating income after taxes	$	1,973		$	2,125		$	1,567
Invested Capital:
Trade receivables	$	2,742		$	2,819		$	2,582
Inventories	1,585			1,716			1,635
Net plant and equipment	1,994			2,025			2,066
Investments	146			409			441
Goodwill and intangible assets	7,788			7,431			6,703
Accounts payable and accrued expenses	(2,068		)	(2,132		)	(2,141		)
Net assets held for sale	—			279			—
Other, net	652			299			(32		)
Total invested capital	$	12,839		$	12,846		$	11,254
Average invested capital	$	13,160		$	12,620		$	10,735
Return on average invested capital	15.0		%	16.8		%	14.6		%

ROIC decreased 180 basis points in 2012 versus 2011 as a result of after-tax operating income decreasing 7.2% and an increase in average invested capital. The decrease in after-tax operating income was due to a higher tax rate in 2012 resulting from discrete tax charges in the fourth quarter of 2012, which included the settlement of an IRS tax audit for the years 2008-2009, versus a discrete tax benefit in the first quarter of 2011 for an Australian tax matter. The fourth quarter 2012 discrete tax charges had an unfavorable 40 basis point impact on ROIC in 2012.

ROIC increased 220 basis points in 2011 versus 2010 as a result of after-tax operating income increasing 35.6%, partially offset by an increase in average invested capital. The increase in after-tax operating income was due to an increase in base business and a lower tax rate in 2011 resulting from a discrete tax benefit in the first quarter of 2011 for an Australian tax matter versus a discrete tax charge in the first quarter of 2010 for the impact of the health care reform legislation. The first quarter 2011 discrete tax benefit had a favorable 140 basis point impact on ROIC in 2011.

Working Capital

Management uses working capital as a measurement of the short-term liquidity of the Company. Net working capital at December 31, 2012 and 2011 is summarized as follows:

Dollars in millions	2012		2011		Increase (Decrease)
Current Assets:
Cash and equivalents	$	2,779	$	1,178	$	1,601
Trade receivables	2,742		2,819		(77		)
Inventories	1,585		1,716		(131		)
Other	854		750		104
Assets held for sale	—		386		(386		)
	7,960		6,849		1,111
Current Liabilities:
Short-term debt	459		502		(43		)
Accounts payable and accrued expenses	2,068		2,132		(64		)
Other	124		236		(112		)
Liabilities held for sale	—		107		(107		)
	2,651		2,977		(326		)
Net Working Capital	$	5,309	$	3,872	$	1,437
Current Ratio	3.00		2.30

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Cash and equivalents totaled approximately $2.8 billion as of December 31, 2012 and $1.2 billion as of December 31, 2011, primarily all of which was held by international subsidiaries and may be subject to U.S. income taxes and foreign withholding taxes if repatriated to the U.S. Cash balances held internationally are typically used for international operating needs, reinvested to fund expansion of existing international businesses, or used to fund new international acquisitions. In the U.S., the Company utilizes cash flows from domestic operations to fund domestic cash needs, which primarily consist of dividend payments, acquisitions, share repurchases, servicing of domestic debt obligations and general corporate needs. The Company also uses its commercial paper program, which is backed by long-term credit facilities of $2.5 billion, for short-term liquidity needs. The Company believes cash generated domestically will continue to be sufficient to fund cash requirements in the U.S.

Debt

Total debt and total debt to capitalization at December 31, 2012 and 2011 were as follows:

Dollars in millions	2012			2011			Increase (Decrease)
Short-term debt	$	459		$	502		$	(43	)
Long-term debt	4,589			3,488			1,101
Total debt	$	5,048		$	3,990		$	1,058
Total debt to total capitalization	32.3		%	28.5		%

The Company may issue commercial paper to fund general corporate needs and to fund small and medium-sized acquisitions. The Company has committed lines of credit of $2.5 billion in the U.S. to support the potential issuances of commercial paper. Of this amount, $1.0 billion is provided under a line of credit agreement with a termination date of June 10, 2016 and $1.5 billion is provided under a line of credit agreement with a termination date of June 8, 2017. No amounts were outstanding under these two facilities at December 31, 2012. The Company’s foreign operations also had authorized credit facilities of $337 million of which $89 million was outstanding as of December 31, 2012.

The Company had outstanding commercial paper of approximately $408 million and $192 million at December 31, 2012 and December 31, 2011, respectively, which is included in short-term debt. The maximum outstanding commercial paper balance during 2012 was $1.5 billion while the average daily balance was $808 million.

In 2012, the Company issued $1.1 billion of 3.9% notes due September 1, 2042 at 99.038% of face value. The effective interest rate of the notes is 3.955%. These notes are senior unsecured obligations, ranking equal in right of payment with all other senior unsecured indebtedness of the Company. The net proceeds from this issuance were used to repay outstanding commercial paper.

The Company believes that, based on its current free operating cash flow, debt to capitalization ratios and credit ratings, it could readily obtain additional financing if necessary.

Total Debt to Adjusted EBITDA

The Company uses the ratio of total debt to adjusted EBITDA to measure its ability to repay its outstanding debt obligations. The Company believes that total debt to adjusted EBITDA is a meaningful metric to investors in evaluating the Company’s long term financial liquidity and may be different than the method used by other companies to calculate total debt to EBITDA. Adjusted EBITDA and the ratio of total debt to adjusted EBITDA are non-GAAP financial measures. The ratio of total debt to adjusted EBITDA represents total debt divided by income from continuing operations before interest expense, gain on sale of interest in Decorative Surfaces, other income (expense), income taxes, depreciation, and amortization and impairment of goodwill and other intangible assets on a trailing twelve month basis.

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Total debt to adjusted EBITDA for the years ended December 31, 2012 and 2011 was as follows:

Dollars in millions	2012			2011
Total debt	$	5,048		$	3,990
Income from continuing operations	$	2,495		$	2,017
Add:
Interest expense	214			192
Gain on sale of interest in Decorative Surfaces	(933		)	—
Other income (expense)	(37		)	(54		)
Income taxes	1,108			576
Depreciation	323			336
Amortization and impairment of goodwill and other intangible assets	290			255
Adjusted EBITDA	$	3,460		$	3,322
Total debt to adjusted EBITDA ratio	1.5			1.2

The Company's debt to adjusted EBITDA ratio increased from 1.2 to 1.5 in 2012 versus 2011 primarily due to the increase in long-term debt related to the $1.1 billion of 3.9% notes that were issued in August 2012.

Stockholders’ Equity

The changes to stockholders’ equity during 2012 and 2011 were as follows:

In millions	2012			2011
Beginning balance	$	10,034		$	9,572
Net income	2,870			2,071
Cash dividends declared	(691		)	(685		)
Repurchases of common stock	(2,020		)	(950		)
Stock option and restricted stock activity	334			221
Currency translation adjustments	94			(141		)
Other	(51		)	(54		)
Ending balance	$	10,570		$	10,034

CONTRACTUAL OBLIGATIONS AND OFF-BALANCE SHEET ARRANGEMENTS

The Company’s significant contractual obligations as of December 31, 2012 were as follows:

In millions	2013		2014		2015		2016		2017		2018 and Future Years
Total long-term debt	$	6	$	1,793	$	2	$	1	$	1	$	2,792
Interest payments on notes	223		194		131		131		131		1,965
Minimum lease payments	153		113		81		61		47		67
	$	382	$	2,100	$	214	$	193	$	179	$	4,824

As of December 31, 2012, the Company has recorded noncurrent liabilities for unrecognized tax benefits of $108 million. The Company is not able to reasonably estimate the timing of payments related to the liabilities for unrecognized tax benefits.

At December 31, 2012, the Company had open stand-by letters of credit of approximately $194 million, substantially all of which expire in 2013 and 2014. The Company had no other significant off-balance sheet commitments at December 31, 2012.

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CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company has six accounting policies which it believes are most important to the Company’s financial condition and results of operations, and which require the Company to make estimates about matters that are inherently uncertain. Management bases its estimates on historical experience, and in some cases on observable market information. Various assumptions are also used that are believed to be reasonable under the circumstances and form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The Company's critical accounting policies are as follows:

Realizability of Inventories— Inventories are stated at the lower of cost or market. Generally, the Company’s businesses perform an analysis of the historical sales usage of the individual inventory items on hand and a reserve is recorded to adjust inventory cost to market value based on the following usage criteria:

Usage Classification	Criteria	Reserve %
Active	Quantity on hand is less than prior 6 months’ usage	0	%
Slow-moving	Some usage in last 12 months, but quantity on hand exceeds prior 6 months’ usage	50	%
Obsolete	No usage in the last 12 months	90	%

In addition, for approximately 44% of the U.S. inventories, the Company has elected to use the last-in, first-out (“LIFO”) method of inventory costing. Generally, this method results in a lower inventory value than the first-in, first-out (“FIFO”) method due to the effects of inflation.

Collectibility of Accounts Receivable— The Company estimates the allowance for uncollectible accounts based on the greater of a specific reserve or a reserve calculated based on the historical write-off percentage over the last two years. In addition, the allowance for uncollectible accounts includes reserves for customer credits and cash discounts, which are also estimated based on past experience.

Depreciation of Plant and Equipment— The Company’s U.S. businesses compute depreciation on an accelerated basis, as follows:

Buildings and improvements	150% declining balance
Machinery and equipment	200% declining balance

The majority of the Company's international businesses compute depreciation on a straight-line basis to conform to their local statutory accounting and tax regulations.

Income Taxes— The Company provides deferred income tax assets and liabilities based on the estimated future tax effects of differences between the financial and tax bases of assets and liabilities based on currently enacted tax laws. The Company’s deferred and other tax balances are based on management’s interpretation of the tax regulations and rulings in numerous taxing jurisdictions. Income tax expense and liabilities recognized by the Company also reflect its best estimates and assumptions regarding, among other things, the level of future taxable income, the effect of the Company’s various tax planning strategies and uncertain tax positions. Future tax authority rulings and changes in tax laws, changes in projected levels of taxable income and future tax planning strategies could affect the actual effective tax rate and tax balances recorded by the Company.

Goodwill and Intangible Assets— The Company’s business acquisitions typically result in recording goodwill and other intangible assets, which are a significant portion of the Company’s total assets and affect the amount of amortization expense and impairment charges that the Company could incur in future periods. The Company follows the guidance prescribed in the accounting standards to test goodwill and intangible assets for impairment. On an annual basis, or more frequently if triggering events occur, the Company compares the estimated fair value of its 40 reporting units to the carrying value of each reporting unit to determine if a potential goodwill impairment exists. If the fair value of a reporting unit is less than its carrying value, an impairment loss, if any, is recorded for the difference between the implied fair value and the carrying value of the reporting unit’s goodwill. In calculating the fair value of the reporting units or specific intangible assets, management relies on a number of factors, including operating results, business plans, economic projections, anticipated future cash flows, comparable transactions and other market data. There are inherent uncertainties related to these factors and management’s judgment in applying them in the impairment tests of goodwill and other intangible assets.

As of December 31, 2012, the Company had total goodwill and intangible assets of $7.8 billion allocated to its 40 reporting units. Although there can be no assurance that the Company will not incur additional impairment charges related to its goodwill and other intangible assets, the Company generally believes the risk of significant impairment charges is lessened by the

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number of diversified businesses and end markets represented by its 40 reporting units that have goodwill and other intangible assets. In addition, the individual businesses in many of the reporting units have been acquired over a long period of time, and in many cases have been able to improve their performance, primarily as a result of the application of the Company’s 80/20 business simplification process. The amount of goodwill and other intangible assets allocated to individual reporting units ranges from approximately $9 million to $1.1 billion, with the average amount equal to $195 million.

Fair value determinations require considerable judgment and are sensitive to changes in the factors described above. Due to the inherent uncertainties associated with these factors and economic conditions in the Company’s global end markets, impairment charges related to one or more reporting units could occur in future periods.

Pension and Other Postretirement Benefits— The Company has various company-sponsored defined benefit retirement plans covering a substantial portion of U.S. employees and many employees outside the U.S. Pension and other postretirement expense and obligations are determined based on actuarial valuations. Pension benefit obligations are generally based on each participant’s years of service, future compensation, and age at retirement or termination. Important assumptions in determining pension and postretirement expense and obligations are the discount rate, the expected long-term return on plan assets and health care cost trend rates. See the Pension and Other Postretirement Benefits note in Item 8. Financial Statements and Supplementary Data for additional discussion of actuarial assumptions used in determining pension and postretirement health care liabilities and expenses.

The Company determines the discount rate used to measure plan liabilities as of the year-end measurement date for the U.S. primary pension plan. The discount rate reflects the current rate at which the associated liabilities could theoretically be effectively settled at the end of the year. In estimating this rate, the Company looks at rates of return on high-quality fixed income investments, with similar duration to the liabilities in the plan. A 25 basis point decrease in the discount rate would increase the present value of the U.S. primary pension plan obligation by approximately $36 million.

The expected long-term return on plan assets is based on historical and expected long-term returns for similar investment allocations among asset classes. For the U.S. primary pension plan, the Company’s assumption for the expected return on plan assets was 8.0% for 2012 and will be 8.0% for 2013. A 25 basis point decrease in the expected return on plan assets would increase the annual pension expense by approximately $3 million. See the Pension and Other Postretirement Benefits note in Item 8. Financial Statements and Supplementary Data for information on the Company's pension and other postretirement benefit plans and related assumptions.

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ITEM 7A.Quantitative and Qualitative Disclosures About Market Risk

MARKET RISK

The Company is exposed to certain market risks which exist as part of its ongoing business operations including changes in currency exchange rates, price volatility for certain commodities and changes in interest rates. The Company does not engage in speculative or leveraged transactions and does not hold or issue financial instruments for trading purposes.

Interest Rate Risk

The Company’s exposure to market risk for changes in interest rates relates primarily to the fair value of the Company’s fixed rate debt. The following table presents the Company’s debt for which fair value is subject to changing market interest rates:

	5.15% Notes Due		5.25% Euro Notes Due		6.25% Notes Due		4.88% Notes Due thru		3.375% Notes Due		4.875% Notes Due		3.9% Notes Due
In millions	Apr 1,  2014		Oct 1,  2014		Apr 1,  2019		Dec 31,  2020		Sep 15,  2021		Sep 15,  2041		Sep 1,  2042
As of December 31, 2012:
Estimated cash outflow by year of principal maturity
2013	$	—	$	—	$	—	$	4	$	—	$	—	$	—
2014	800		989		—		3		—		—		—
2015	—		—		—		1		—		—		—
2016	—		—		—		—		—		—		—
2017	—		—		—		—		—		—		—
2018 and thereafter	—		—		700		4		350		650		1,100
Estimated fair value	846		1,071		877		13		381		770		1,132
Carrying value	800		989		700		12		349		641		1,089
As of December 31, 2011:
Total estimated cash outflow	$	800	$	972	$	700	$	22	$	350	$	650	$	—
Estimated fair value	877		1,064		872		24		368		761		—
Carrying value	800		971		700		22		348		641		—

Foreign Currency Risk

The Company operates in the U.S. and 57 foreign countries. In general, the Company’s products are primarily manufactured and sold within the same country. The initial funding for the foreign manufacturing operations was provided primarily through the permanent investment of equity capital from the U.S. parent company. Therefore, the Company and its subsidiaries do not have significant assets or liabilities denominated in currencies other than their functional currencies. As such, the Company does not have any significant derivatives or other financial instruments that are subject to foreign currency risk at December 31, 2012 or 2011.

In October 2007, the Company issued €750 million of 5.25% Euro notes due October 1, 2014. The Company has significant operations with the Euro as their functional currency. The Company believes that the Euro cash flows from these businesses will be adequate to fund the debt obligations under these notes.

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ITEM 8.Financial Statements and Supplementary Data

MANAGEMENT REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The management of Illinois Tool Works Inc. (the “Company” or “ITW”) is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). ITW’s internal control system was designed to provide reasonable assurance to the Company’s management and Board of Directors regarding the preparation and fair presentation of published financial statements.

All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

ITW management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2012. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. Based on our assessment we believe that, as of December 31, 2012, the Company’s internal control over financial reporting is effective based on those criteria.

The effectiveness of the Company’s internal control over financial reporting as of December 31, 2012 has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report herein.

/s/ E. Scott Santi E. Scott Santi President & Chief Executive Officer February 19, 2013 /s/ Ronald D. Kropp Ronald D. Kropp Senior Vice President & Chief Financial Officer February 19, 2013

39

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Illinois Tool Works Inc. Glenview, IL

We have audited the accompanying consolidated statements of financial position of Illinois Tool Works Inc. and Subsidiaries (the "Company") as of December 31, 2012 and 2011, and the related consolidated statements of income, comprehensive income, income reinvested in the business, and cash flows for each of the three years in the period ended December 31, 2012. We also have audited the Company's internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company's management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on these financial statements and an opinion on the Company's internal control over financial reporting based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's principal executive and principal financial officers, or persons performing similar functions, and effected by the company's board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Illinois Tool Works Inc. and Subsidiaries as of December 31, 2012 and 2011, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2012, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on the criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

/s/ DELOITTE & TOUCHE LLP

Deloitte & Touche LLP

Chicago, Illinois

February 19, 2013

40

Statement of Income

Illinois Tool Works Inc. and Subsidiaries

	For the Years Ended December 31
In millions except per share amounts	2012			2011			2010
Operating Revenues	$	17,924		$	17,787		$	15,416
Cost of revenues	11,455			11,518			9,997
Selling, administrative, and research and development expenses	3,332			3,283			2,957
Amortization of intangible assets	288			255			207
Impairment of goodwill and other intangible assets	2			—			1
Operating Income	2,847			2,731			2,254
Interest expense	(214		)	(192		)	(175		)
Gain on sale of interest in Decorative Surfaces	933			—			—
Other income (expense)	37			54			10
Income from Continuing Operations Before Income Taxes	3,603			2,593			2,089
Income taxes	1,108			576			637
Income from Continuing Operations	2,495			2,017			1,452
Income from Discontinued Operations	375			54			51
Net Income	$	2,870		$	2,071		$	1,503
Income Per Share from Continuing Operations:
Basic	$	5.31		$	4.10		$	2.90
Diluted	$	5.27		$	4.08		$	2.89
Income Per Share from Discontinued Operations:
Basic	$	0.80		$	0.11		$	0.10
Diluted	$	0.79		$	0.11		$	0.10
Net Income Per Share:
Basic	$	6.11		$	4.21		$	3.00
Diluted	$	6.06		$	4.19		$	2.99

The Notes to Financial Statements are an integral part of this statement.

41

Statement of Comprehensive Income

Illinois Tool Works Inc. and Subsidiaries

	For the Years Ended December 31
In millions	2012			2011			2010
Net Income	$	2,870		$	2,071		$	1,503
Other Comprehensive Income:
Foreign currency translation adjustments	94			(141		)	153
Pension and other postretirement benefit adjustments, net of tax	(25		)	(62		)	25
Comprehensive Income	$	2,939		$	1,868		$	1,681

Statement of Income Reinvested in the Business

Illinois Tool Works Inc. and Subsidiaries

	For the Years Ended December 31
In millions	2012			2011			2010
Beginning Balance	$	11,794		$	10,408		$	9,555
Net income	2,870			2,071			1,503
Cash dividends declared	(691		)	(685		)	(650		)
Ending Balance	$	13,973		$	11,794		$	10,408

The Notes to Financial Statements are an integral part of these statements.

42

Statement of Financial Position

Illinois Tool Works Inc. and Subsidiaries

	December 31
In millions except shares	2012			2011
Assets
Current Assets:
Cash and equivalents	$	2,779		$	1,178
Trade receivables	2,742			2,819
Inventories	1,585			1,716
Deferred income taxes	332			366
Prepaid expenses and other current assets	522			384
Assets held for sale	—			386
Total current assets	7,960			6,849
Net plant and equipment	1,994			2,025
Investments	146			409
Goodwill	5,530			5,198
Intangible assets	2,258			2,233
Deferred income taxes	391			634
Other assets	1,030			636
	$	19,309		$	17,984
Liabilities and Stockholders’ Equity
Current Liabilities:
Short-term debt	$	459		$	502
Accounts payable	676			697
Accrued expenses	1,392			1,435
Cash dividends payable	—			174
Income taxes payable	116			57
Deferred income taxes	8			5
Liabilities held for sale	—			107
Total current liabilities	2,651			2,977
Noncurrent Liabilities:
Long-term debt	4,589			3,488
Deferred income taxes	244			117
Other liabilities	1,255			1,368
Total noncurrent liabilities	6,088			4,973
Stockholders’ Equity:
Common stock:
Issued—549,551,660 shares in 2012 and 542,500,435 shares in 2011	5			5
Additional paid-in-capital	1,012			686
Income reinvested in the business	13,973			11,794
Common stock held in treasury	(4,722		)	(2,692		)
Accumulated other comprehensive income	293			224
Noncontrolling interest	9			17
Total stockholders’ equity	10,570			10,034
	$	19,309		$	17,984

The Notes to Financial Statements are an integral part of this statement.

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Statement of Cash Flows

Illinois Tool Works Inc. and Subsidiaries

	For the Years Ended December 31
In millions	2012			2011			2010
Cash Provided by (Used for) Operating Activities:
Net income	$	2,870		$	2,071		$	1,503
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	323			336			335
Amortization and impairment of goodwill and other intangible assets	290			258			214
Change in deferred income taxes	243			(176		)	(143		)
Provision for uncollectible accounts	11			5			4
Income from investments	(11		)	(17		)	(21		)
Gain on sale of plant and equipment	(4		)	(2		)	(1		)
(Gain) loss on disposal of discontinued operations	(475		)	4			(21		)
(Gain) loss on disposal of operations and affiliates	(955		)	(2		)	8
Stock compensation expense	54			56			56
Other non-cash items, net	23			(6		)	(2		)
Change in assets and liabilities:
(Increase) decrease in—
Trade receivables	(13		)	(303		)	(170		)
Inventories	82			(51		)	(223		)
Prepaid expenses and other assets	(75		)	(50		)	(39		)
Increase (decrease) in—
Accounts payable	(21		)	(55		)	70
Accrued expenses and other liabilities	(87		)	52			67
Income taxes receivable and payable	(173		)	(182		)	(149		)
Other, net	(10		)	18			—
Net cash provided by operating activities	2,072			1,956			1,488
Cash Provided by (Used for) Investing Activities:
Acquisition of businesses (excluding cash and equivalents) and additional interest in affiliates	(723		)	(1,308		)	(497		)
Additions to plant and equipment	(382		)	(353		)	(288		)
Purchases of investments	(1		)	(6		)	(16		)
Proceeds from investments	281			37			27
Proceeds from sale of plant and equipment	30			17			18
Net proceeds from sale of discontinued operations	723			—			—
Proceeds from sale of operations and affiliates	1,120			22			63
Other, net	(1		)	12			21
Net cash provided by (used for) investing activities	1,047			(1,579		)	(672		)
Cash Provided by (Used for) Financing Activities:
Cash dividends paid	(865		)	(680		)	(636		)
Issuance of common stock	283			153			115
Repurchases of common stock	(2,020		)	(950		)	(350		)
Net proceeds (repayments) of debt with original maturities of three months or less	208			167			(157		)
Proceeds from debt with original maturities of more than three months	1,079			990			1
Repayments of debt with original maturities of more than three months	(272		)	(9		)	(34		)
Excess tax benefits from share-based compensation	16			8			8
Net cash used for financing activities	(1,571		)	(321		)	(1,053		)
Effect of Exchange Rate Changes on Cash and Equivalents	53			(64		)	77
Cash and Equivalents:
Increase (decrease) during the year	1,601			(8		)	(160		)
Beginning of year	1,178			1,186			1,346
End of year	$	2,779		$	1,178		$	1,186
Supplementary Cash Flow Information:
Cash Paid During the Year for Interest	$	211		$	168		$	175
Cash Paid During the Year for Income Taxes, Net of Refunds	$	1,134		$	978		$	960
Supplementary Non-Cash Investing Information:
Liabilities Assumed from Acquisitions	$	194		$	200		$	216
Equity investment in Wilsonart	$	204		$	—		$	—

The Notes to Financial Statements are an integral part of this statement.

44

Notes to Financial Statements

The Notes to Financial Statements furnish additional information on items in the financial statements. The notes have been arranged in the same order as the related items appear in the statements.

Illinois Tool Works Inc. (the “Company” or “ITW”) is a multinational manufacturer of a diversified range of industrial products and equipment with operations in 58 countries. The Company primarily serves the general industrial, automotive OEM/tiers, automotive aftermarket, construction, food and beverage, and food institutional/restaurant and service markets.

Significant accounting principles and policies of the Company are in italics. Certain reclassifications of prior years’ data have been made to conform to current year reporting.

The preparation of the Company’s financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the notes to financial statements. Actual results could differ from those estimates. The significant estimates included in the preparation of the financial statements are related to inventories, trade receivables, plant and equipment, income taxes, goodwill and intangible assets, product liability matters, litigation, product warranties, pensions, other postretirement benefits, environmental matters and stock based compensation.

On January 1, 2012, the Company adopted new accounting guidance that requires the presentation of net income and comprehensive income either in a single continuous financial statement or in two separate but consecutive financial statements. The Company is reporting comprehensive income in a separate consecutive financial statement for interim and annual reporting periods.

International Reporting Lag—Prior to 2011, the Company’s international operations outside of North America had a fiscal reporting period that began on December 1 and ended on November 30. Effective January 1, 2011, the Company eliminated the one-month lag for the reporting of its international operations outside of North America. As a result, the Company is now reporting both North American and international results on a calendar year basis. The Company determined that the elimination of the one-month reporting lag was preferable because the same period-end reporting date improves overall financial reporting as the impact of current events, economic conditions and global trends are consistently reflected in the financial statements of the North American and international businesses.

The Company applied this change in accounting principle retrospectively to all prior financial statement periods presented. The impact of the elimination of the one-month reporting lag for international operations outside of North America for the year ended December 31, 2010 was as follows:

	Increase (Decrease)
In millions except per share amounts	2010
Operating revenues	$	(22	)
Income from continuing operations	(25		)
Income from continuing operations per diluted share	(0.04		)
Net income	(24		)
Net income per diluted share	(0.04		)

The cumulative effect of adopting this change in accounting principle was recorded to income reinvested in the business as of January 1, 2009.

Consolidation and Translation—The financial statements include the Company and its majority-owned subsidiaries. The Company follows the equity method of accounting for investments where the Company has a significant influence but not a controlling interest. All significant intercompany transactions are eliminated from the financial statements. Foreign subsidiaries’ assets and liabilities are translated to U.S. dollars at end-of-period exchange rates. Revenues and expenses are translated at average rates for the period. Translation adjustments are reported as a component of accumulated other comprehensive income in stockholders’ equity.

Divestiture of Majority Interest in Decorative Surfaces Segment—On August 15, 2012, the Company entered into a definitive agreement (the “Investment Agreement”) to divest a 51% majority interest in its Decorative Surfaces segment to certain funds managed by Clayton, Dubilier & Rice, LLC (“CD&R”). The transaction closed on October 31, 2012 resulting in a pre-tax gain of $933 million ($632 million after-tax) in the fourth quarter of 2012.

45

Under the terms of the Investment Agreement, the Company contributed the assets and stock of the Decorative Surfaces segment to a newly formed joint venture, Wilsonart International Holdings LLC (“Wilsonart”). Through a combination of CD&R's equity investment in Wilsonart and new third party borrowings by a subsidiary of Wilsonart, the Company and its subsidiaries received payments of approximately $1.05 billion from Wilsonart and its subsidiaries as well as common units (the “Common Units”) initially representing approximately 49% (on an as-converted basis) of the total outstanding equity of Wilsonart immediately following the closing of the transaction. CD&R contributed $395 million to Wilsonart in exchange for newly issued cumulative convertible participating preferred units (the “Preferred Units”) of Wilsonart initially representing approximately 51% (on an as-converted basis) of the total outstanding equity immediately following the closing of the transaction. The Preferred Units rank senior to the Common Units as to dividends and liquidation preference. The Preferred Units have an initial liquidation preference of $395 million and accrue dividends at a rate of 10.00% per annum payable in cash or in additional Preferred Units at the option of Wilsonart. In the event the amount of dividends paid in additional Preferred Units exceeds certain thresholds, the dividends may accumulate as cash dividends to be paid at a later date, in which case the dividend rate will increase to 12.00% per annum.  Dividend payments on the Preferred Units may be eliminated if Wilsonart achieves certain performance targets for three twelve-month periods. Under the terms of the Investment Agreement, Wilsonart incurred new third party indebtedness of approximately $725 million.

As of October 31, 2012, the Company ceased consolidating the results of the Decorative Surfaces segment and now reports its ownership interest in Wilsonart using the equity method of accounting. The Company recorded its initial equity investment in Wilsonart at fair value. The fair value was determined using an implied equity value approach, which is a Level 3 valuation method. Under this approach, the total equity of Wilsonart was valued using an option pricing model and the value of the Preferred Units was deducted to arrive at the implied equity value of the Common Units. The significant unobservable inputs utilized in this calculation were the expected term of the investment and assumed volatility during the term. The Company also applied a discount factor to the implied equity value of the Common Units due to the lack of marketability of the Common Units. The fair value of the Company's retained ownership interest was determined to be $204 million and resulted in a pre-tax gain of $51 million related to the retained interest which was included in the pre-tax gain noted above. The Company's equity investment in Wilsonart is reported in Other assets in the consolidated statement of financial position. The Company's proportionate share in the income (loss) of Wilsonart is reported in Other income (expense) in the consolidated statement of income. As the Company's investment in Wilsonart is structured as a partnership for U.S. tax purposes, U.S. taxes are recorded separately from the equity investment. For the two month period ended December 31, 2012, the Company recorded a loss of $30 million in Other income(expense) related to its interest in Wilsonart. Wilsonart's loss for the two month period was primarily due to transaction costs related to the formation of Wilsonart and the impact of purchase accounting.

Due to the Company's continuing involvement through its 49% interest in Wilsonart, the historical operating results of Decorative Surfaces are presented in continuing operations. Additionally, as of November 1, 2012, the operating results of Decorative Surfaces are no longer reviewed by senior management of the Company and therefore Decorative Surfaces is no longer a reportable segment of the Company.

Historical operating results of Decorative Surfaces for 2012, 2011 and 2010 were as follows:

	For the Ten Months Ended October 31,		For the Twelve Months Ended December 31,
In millions	2012		2011		2010
Operating revenues	$	921	$	1,084	$	992
Operating income	122		132		117

Discontinued Operations—The Company periodically reviews its operations for businesses which may no longer be aligned with its long-term objectives. In April 2011, the Company entered into a definitive agreement to sell its finishing group of businesses included within the All Other segment to Graco Inc. in a $650 million cash transaction. The sale of the finishing business to Graco was completed on April 2, 2012. The finishing business was classified as held for sale beginning in the second quarter of 2011.

In the second quarter of 2011, the Company’s Board of Directors approved plans to divest a consumer packaging business in the All Other segment and an electronics components business in the Power Systems & Electronics segment. The consumer packaging and electronics components businesses were classified as held for sale beginning in the second quarter of 2011. The electronics components business was sold in the fourth quarter of 2011. The consumer packaging business was sold in the third quarter of 2012. The Company exited a flooring business in the Decorative Surfaces segment in early 2011 and sold a security printing business in the All Other segment in the third quarter of 2010.

46

The consolidated statement of income and the notes to financial statements were restated to present the operating results of the held for sale and previously divested or exited businesses discussed above as discontinued operations for 2012, 2011 and 2010.

Results of the discontinued operations for the years ended December 31, 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Operating revenues	$	142		$	470		$	433
Income before income taxes	$	488		$	82		$	85
Income tax expense	(113		)	(28		)	(34		)
Income from discontinued operations	$	375		$	54		$	51

Income before income taxes from discontinued operations in 2012 included a $452 million gain ($372 million after-tax) related to the sale of the finishing business and a $24 million gain ($3 million after-tax) related to the sale of the consumer packaging business. Income before income taxes from discontinued operations included a $4 million loss ($3 million loss after-tax) related to the sale of the electronics components business in 2011 and a $20 million gain ($5 million after-tax) related to the sale of the security printing business in 2010.

The assets and liabilities of the divested businesses discussed above were presented as assets and liabilities held for sale in the statement of financial position. There were no businesses classified as held for sale at December 31, 2012. Assets and liabilities held for sale at December 31, 2011 included both the consumer packaging and finishing businesses discussed above. The following table summarizes the classes of assets and liabilities held for sale at December 31, 2011:

In millions	December 31, 2011
Trade receivables	$	72
Inventories	56
Net plant and equipment	44
Goodwill and intangible assets	201
Other	13
Total assets held for sale	$	386
Accounts payable	$	22
Accrued expenses	55
Other	30
Total liabilities held for sale	$	107

Acquisitions—The Company accounts for acquisitions under the acquisition method, in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition. The operating results of the acquired companies are included in the Company’s consolidated financial statements from the date of acquisition. Acquisitions, individually and in the aggregate, did not materially affect the Company’s results of operations or financial position for any period presented. Summarized information related to acquisitions is as follows:

In millions except number of acquisitions	2012		2011		2010
Number of acquisitions	23		28		24
Net cash paid during the year	$	723	$	1,308	$	497

47

The premium over tangible net assets recorded for acquisitions based on purchase price allocations during 2012, 2011 and 2010 was as follows:

	2012			2011			2010
In millions except weighted-average lives (years)	Weighted- Average Life	Premium Recorded		Weighted- Average Life	Premium Recorded		Weighted- Average Life	Premium Recorded
Goodwill		$	333		$	476		$	219
Amortizable intangible assets:
Customer lists and relationships	12.2	169		12.2	362		11.8	121
Patents and proprietary technology	8.2	38		9.6	98		10.9	32
Trademarks and brands	12.8	36		17.3	245		14.9	71
Noncompete agreements	4.5	29		5.0	27		5.3	5
Other	7.2	12		1.8	11		4.9	12
Total amortizable intangible assets	10.7	284		13.1	743		12.1	241
Indefinite-lived intangible assets:
Trademarks and brands		42			5			—
Total premium recorded		$	659		$	1,224		$	460

Of the total goodwill recorded for acquisitions, the Company expects goodwill of $15 million in 2012, $302 million in 2011 and $51 million in 2010 will be tax deductible.

Operating Revenuesare recognized when persuasive evidence of an arrangement exists, product has shipped and the risks and rewards of ownership have transferred or services have been rendered, the price to the customer is fixed or determinable, and collectibility is reasonably assured, which is generally at the time of product shipment. Typical sales arrangements are for standard products and provide for transfer of ownership and risk of loss at the time of shipment. In limited circumstances where significant obligations to the customer are unfulfilled at the time of shipment, typically involving installation and customer acceptance, revenue recognition is deferred until such obligations have been completed. Customer allowances and rebates, consisting primarily of volume discounts and other short-term incentive programs, are estimated at the time of sale based on historical experience and known trends and are recorded as a reduction in reported revenues. No single customer accounted for more than 5% of consolidated revenues in 2012, 2011 or 2010.

In October 2009, new accounting guidance was issued on multiple-deliverable revenue arrangements. The new accounting guidance amends the accounting for multiple-deliverable arrangements to enable the vendor to account for product or services separately rather than as a combined unit. The guidance establishes a hierarchy for determining the selling price of a deliverable, which is based on: (1) vendor-specific objective evidence, (2) third-party evidence or (3) estimates. The Company adopted the new accounting guidance on January 1, 2011, and the adoption did not materially affect the Company’s financial position or results of operations.

Research and Development Expensesare recorded as expense in the year incurred. These costs were $266 million in 2012, $243 million in 2011 and $213 million in 2010.

Rental Expense was $178 million in 2012, $178 million in 2011 and $165 million in 2010. Future minimum lease payments under non-cancelable leases for the years ending December 31 are as follows:

In millions
2013	$	153
2014	113
2015	81
2016	61
2017	47
2018 and future years	67
	$	522

Advertising Expensesare recorded as expense in the year incurred. These costs were $84 million in 2012, $88 million in 2011 and $72 million in 2010.

48

Other Income (Expense) consisted of the following:

In millions	2012			2011			2010
Interest income	$	40		$	40		$	24
Gain (loss) on disposal of operations and affiliates	22			2			(8		)
Income from investments	11			17			21
Gain (loss) on foreign currency transactions, net	(11		)	(4		)	(17		)
Equity loss in Wilsonart	(30		)	—			—
Other, net	5			(1		)	(10		)
	$	37		$	54		$	10

Income Taxes—The Company utilizes the asset and liability method of accounting for income taxes. Deferred income taxes are determined based on the estimated future tax effects of differences between the financial and tax bases of assets and liabilities given the provisions of the enacted tax laws. The components of the provision for income taxes were as shown below:

In millions	2012			2011			2010
U.S. federal income taxes:
Current	$	566		$	515		$	397
Deferred	250			(34		)	(46		)
	816			481			351
Foreign income taxes:
Current	275			147			266
Deferred	(29		)	(82		)	(19		)
Benefit of net operating loss carryforwards	(30		)	(4		)	(3		)
	216			61			244
State income taxes:
Current	71			65			52
Deferred	5			(31		)	(3		)
Benefit of net operating loss carryforwards	—			—			(7		)
	76			34			42
	$	1,108		$	576		$	637

Income from continuing operations before income taxes for domestic and foreign operations was as follows:

In millions	2012		2011		2010
Domestic	$	2,471	$	1,452	$	1,217
Foreign	1,132		1,141		872
	$	3,603	$	2,593	$	2,089

49

The reconciliation between the U.S. federal statutory tax rate and the effective tax rate was as follows:

	2012		2011		2010
U.S. federal statutory tax rate	35.0	%	35.0	%	35.0	%
State income taxes, net of U.S. federal tax benefit	0.9		1.1		1.2
Differences between U.S. federal statutory and foreign tax rates	(2.3	)	(2.7	)	(2.0	)
Nontaxable foreign interest income	(2.5	)	(3.6	)	(3.4	)
Australian court decision	—		(6.4	)	—
Tax effect of foreign dividends	0.6		0.4		0.5
Tax relief for U.S. manufacturers	(1.1	)	(1.3	)	(1.3	)
Other, net	0.1		(0.3	)	0.5
Effective tax rate	30.7	%	22.2	%	30.5	%

Deferred U.S. federal income taxes and foreign withholding taxes have not been provided on the remaining undistributed earnings of certain international subsidiaries as these earnings are considered permanently invested. Undistributed earnings of these subsidiaries were approximately $8.3 billion and $6.3 billion as of December 31, 2012 and 2011, respectively. Upon repatriation of these earnings to the U.S. in the form of dividends or otherwise, the Company may be subject to U.S. income taxes and foreign withholding taxes. The actual U.S. tax cost would depend on income tax laws and circumstances at the time of distribution. Determination of the related tax liability is not practicable because of the complexities associated with the hypothetical calculation.

The components of deferred income tax assets and liabilities at December 31, 2012 and 2011 were as follows:

	2012						2011
In millions	Asset			Liability			Asset			Liability
Goodwill and intangible assets	$	382		$	(901	)	$	355		$	(787	)
Inventory reserves, capitalized tax cost and LIFO inventory	68			(11		)	76			(13		)
Investments	37			(283		)	36			(56		)
Plant and equipment	14			(103		)	28			(107		)
Accrued expenses and reserves	58			—			79			—
Employee benefit accruals	362			—			351			—
Foreign tax credit carryforwards	31			—			12			—
Net operating loss carryforwards	709			—			623			—
Capital loss carryforwards	37			—			34			—
Allowances for uncollectible accounts	17			—			20			—
Pension liabilities	102			—			113			—
Deferred intercompany deductions	321			—			460			—
Other	122			(16		)	124			(21		)
Gross deferred income tax assets (liabilities)	2,260			(1,314		)	2,311			(984		)
Valuation allowances	(475		)	—			(449		)	—
Total deferred income tax assets (liabilities)	$	1,785		$	(1,314	)	$	1,862		$	(984	)

Valuation allowances are established when it is estimated that it is more likely than not that the tax benefit of the deferred tax asset will not be realized. The valuation allowances recorded at December 31, 2012 and 2011 relate primarily to certain net operating loss carryforwards and capital loss carryforwards.

50

At December 31, 2012, the Company had net operating loss carryforwards available to offset future taxable income in the U.S. and certain foreign jurisdictions, which expire as follows:

In millions	Gross Carryforwards Related to Net Operating Losses
2013	$	5
2014	4
2015	4
2016	8
2017	17
2018	23
2019	24
2020	72
2021	74
2022	20
2023	14
2024	11
2025	10
2026	7
2027	13
2028	6
2029	7
2030	5
2031	1
2032	23
Do not expire	2,031
	$	2,379

The Company has foreign tax credit carryforwards of $31 million as of December 31, 2012 that are available for use by the Company between 2013 and 2022.

The changes in the amount of unrecognized tax benefits during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	437		$	718		$	725
Additions based on tax positions related to the current year	32			43			57
Additions for tax positions of prior years	62			74			56
Reductions for tax positions of prior years	(163		)	(16		)	(96		)
Settlements	(125		)	(377		)	—
Foreign currency translation	6			(5		)	(24		)
Ending balance	$	249		$	437		$	718

Included in the balance at December 31, 2012 are approximately $249 million of tax positions that, if recognized, would impact the Company’s effective tax rate.

During the fourth quarter of 2012, the Company came to an agreement with the Internal Revenue Service on issues related predominately to intercompany transactions and global legal structure reorganization transactions identified by the Internal Revenue Service during its 2008-2009 audit. Based on this agreement, the Company decreased its unrecognized tax benefits related to this matter by approximately $125 million and recorded an unfavorable discrete tax charge of $35 million.

51

The Company litigated a dispute with the Australian Tax Office over the tax treatment of an intercompany financing transaction between the U.S. and Australia. The case was heard before the Federal Court of Australia, Victoria, in September 2010. The proceedings resulted from the Company’s appeal of a decision by the Australian Tax Commissioner to disallow income tax deductions for the income tax years 2002 through 2005 and the assessment of withholding taxes for income tax year 2003. The Company also contested the Commissioner’s similar determination for income tax years 2006 and 2007; however, the parties agreed to follow the Court’s decision made on the earlier years. On February 4, 2011, the Federal Court of Australia, Victoria, decided in the Company’s favor with respect to a significant portion of the income tax deductions. The Court issued the final orders on February 18, 2011. Based on this decision, the Company decreased its unrecognized tax benefits related to this matter by approximately $197 million and recorded a favorable discrete non-cash tax benefit to reduce tax expense by $166 million in the first quarter of 2011. Subsequent to the 2011 ruling, the Australian Tax Office appealed the timing of certain of the deductions. In March 2012, the Court ruled in favor of the Australian Tax Office regarding the timing of the deductions, which did not have a material impact to the Company.

During the first quarter of 2011, the Company resolved an issue with the Internal Revenue Service in the U.S. related to a deduction for foreign exchange losses on an intercompany loan that resulted in a decrease in unrecognized tax benefits of approximately $179 million.

In March 2010, the Patient Protection and Affordable Care Act and Health Care and Education Reconciliation Act were signed into law. As a result, future tax deductions for retiree prescription drug coverage will be reduced by the amount of subsidies received starting in 2013. In the first quarter of 2010, the Company recorded a discrete tax charge of $22 million for the impact of the health care reform legislation.

The Company and its subsidiaries file tax returns in the U.S. and various state, local and foreign jurisdictions. These tax returns are routinely audited by the tax authorities in these jurisdictions including the Internal Revenue Service, Her Majesty's Revenue and Customs, German Fiscal Authority, French Fiscal Authority, and Australian Tax Office, and a number of these audits are currently ongoing, which may increase the amount of the unrecognized tax benefits in future periods. Due to the ongoing audits, the Company believes it is reasonably possible that within the next twelve months the amount of the Company's unrecognized tax benefits may be decreased by approximately $39 million related predominantly to various intercompany transactions. The Company has recorded its best estimate of the potential exposure for these issues. The following table summarizes the open tax years for the Company’s major jurisdictions:

Jurisdiction	Open Tax Years
United States – Federal	2004-2012
United Kingdom	2000-2012
Germany	2006-2012
France	2004-2012
Australia	2006-2012

The Company recognizes interest and penalties related to income tax matters in income tax expense. The accrual for interest and penalties as of December 31, 2012 and 2011 was $16 million and $2 million, respectively.

Income Per Share from Continuing Operationsis computed by dividing income from continuing operations by the weighted-average number of shares outstanding for the period. Income from continuing operations per diluted share is computed by dividing income from continuing operations by the weighted-average number of shares assuming dilution for stock options and restricted stock units. Dilutive shares reflect the potential additional shares that would be outstanding if the dilutive stock options outstanding were exercised and the unvested restricted stock units vested during the period. The computation of income per share from continuing operations was as follows:

52

In millions except per share amounts	2012		2011		2010
Income from continuing operations	$	2,495	$	2,017	$	1,452
Income per share from continuing operations—Basic:
Weighted-average common shares	469.8		491.4		500.8
Income per share from continuing operations—Basic	$	5.31	$	4.10	$	2.90
Income per share from continuing operations—Diluted:
Weighted-average common shares	469.8		491.4		500.8
Effect of dilutive stock options and restricted stock units	3.4		3.2		2.5
Weighted-average common shares assuming dilution	473.2		494.6		503.3
Income per share from continuing operations—Diluted	$	5.27	$	4.08	$	2.89

Options that were considered antidilutive were not included in the computation of diluted income per share from continuing operations. The number of antidilutive options outstanding as of December 31, 2012, 2011 and 2010 was 0.1 million, 5.0 million and 10.4 million, respectively.

Cash and Equivalents included interest-bearing instruments of $1.0 billion at December 31, 2012 and $551 million at December 31, 2011. These interest-bearing instruments have maturities of 90 days or less and are stated at cost, which approximates fair value.

Trade Receivables were net of allowances for uncollectible accounts. The changes in the allowances for uncollectible accounts during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	(65	)	$	(70	)	$	(76	)
Provision charged to expense	(11		)	(5		)	(4		)
Write-offs, net of recoveries	14			10			12
Acquisitions and divestitures	—			(4		)	(3		)
Foreign currency translation	(1		)	2			1
Other	(2		)	2			—
Ending balance	$	(65	)	$	(65	)	$	(70	)

Inventories at December 31, 2012 and 2011 were as follows:

In millions	2012		2011
Raw material	$	539	$	596
Work-in-process	152		156
Finished goods	894		964
	$	1,585	$	1,716

Inventories are stated at the lower of cost or market and include material, labor and factory overhead. The last-in, first-out (“LIFO”) method is used to determine the cost of the inventories of approximately 44% of the U.S. inventories. Inventories priced at LIFO were approximately 21% and 22% of total inventories as of December 31, 2012 and 2011, respectively. The first-in, first-out (“FIFO”) method, which approximates current cost, is used for all other inventories. If the FIFO method was used for all inventories, total inventories would have been approximately $101 million and $128 million higher than reported at December 31, 2012 and 2011, respectively.

53

Prepaid Expenses and Other Current Assets as of December 31, 2012 and 2011 were as follows:

In millions	2012		2011
Income tax refunds receivable	$	231	$	112
Value-added-tax receivables	71		65
Vendor advances	52		40
Other	168		167
	$	522	$	384

Net Plant and Equipmentare stated at cost, less accumulated depreciation. Renewals and improvements that increase the useful life of plant and equipment are capitalized. Maintenance and repairs are charged to expense as incurred.

Depreciation was $323 million in 2012, $334 million in 2011 and $328 million in 2010, and was reflected primarily in cost of revenues. Depreciation included in income from discontinued operations was $2 million in 2011 and $7 million in 2010. There was no depreciation included in income from discontinued operations in 2012. Depreciation of plant and equipment for financial reporting purposes is computed on an accelerated basis for U.S. businesses and on a straight-line basis for a majority of the international businesses.

Net plant and equipment consisted of the following at December 31, 2012 and 2011:

In millions	2012			2011
Land	$	237		$	248
Buildings and improvements	1,496			1,567
Machinery and equipment	3,761			3,972
Equipment leased to others	180			187
Construction in progress	157			113
Gross plant and equipment	5,831			6,087
Accumulated depreciation	(3,837		)	(4,062		)
Net plant and equipment	$	1,994		$	2,025

The ranges of useful lives used to depreciate plant and equipment are as follows:

Buildings and improvements	5—50 years
Machinery and equipment	3—12 years
Equipment leased to others	Term of lease

Investments as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Leases of equipment	$	33	$	275
Venture capital limited partnership	36		43
Properties held for sale	39		42
Property developments	26		26
Affordable housing limited partnerships	12		23
	$	146	$	409

54

Leases of Equipment

The components of the investment in leases of equipment at December 31, 2012 and 2011 were as shown below:

In millions	2012			2011
Leveraged and direct financing leases:
Gross lease contracts receivable, net of nonrecourse debt service	$	—		$	130
Estimated residual value of leased assets	28			248
Unearned income	(1		)	(110		)
	27			268
Equipment under operating leases	6			7
	$	33		$	275

Deferred tax liabilities related to leases of equipment were $38 million and $54 million at December 31, 2012 and 2011, respectively.

The investment in leases of equipment at December 31, 2012 and 2011 consisted of the following types of equipment:

In millions	2012		2011
Aircraft	$	33	$	34
Telecommunications	—		171
Air traffic control	—		70
	$	33	$	275

Income from leveraged leases was $5 million, $13 million and $11 million for the years ended December 31, 2012, 2011 and 2010, respectively. Unearned income related to leveraged leases is recognized as lease income over the life of the lease based on the effective yield of the lease. The Company adjusts recognition of lease income on its leveraged leases when there is a change in the assumptions affecting total income or the timing of cash flows associated with the lease. The residual values of leased assets are estimated at the inception of the lease based on market appraisals and reviewed for impairment at least annually.

In 2012, the Company terminated leveraged leasing transactions related to mobile telecommunications equipment with two major European telecommunications companies and a leveraged lease transaction related to air traffic control equipment in Australia. The Company received proceeds of $231 million and recorded a loss of $8 million related to these transactions. Income from leveraged leases and the loss on the terminated leveraged leasing transactions were included in Other income (expense) in the consolidated statement of income.

Other Investments

The Company entered into a venture capital limited partnership in 2001 that invests primarily in late-stage venture capital opportunities. The Company has a 25% limited partnership interest and accounts for this investment using the equity method, whereby the Company recognizes its proportionate share of the partnership's income or loss. The partnership’s financial statements are prepared on a mark-to-market basis.

The Company invested in property developments with a residential construction developer through partnerships in which the Company has a 50% interest. These partnership investments are accounted for using the equity method, whereby the Company recognizes its proportionate share of the partnerships' income or loss.

The Company entered into several affordable housing limited partnerships primarily to receive tax benefits in the form of tax credits and tax deductions from operating losses. These affordable housing investments are accounted for using the effective yield method, in which the investment is amortized to income tax expense as the tax benefits are received. The tax credits are credited to income tax expense as they are allocated to the Company.

55

Goodwill and Intangible Assets—Goodwill represents the excess cost over fair value of the net assets of purchased businesses. The Company does not amortize goodwill and intangible assets that have indefinite lives. The Company performs an annual impairment assessment of goodwill and intangible assets with indefinite lives based on the estimated fair value of the related reporting unit or intangible asset. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.

When performing its annual impairment assessment, the Company evaluates the goodwill assigned to each of its 40 reporting units for potential impairment by comparing the estimated fair value of the relevant reporting unit to the carrying value. The Company uses various valuation techniques to determine the fair value of its reporting units, including discounting estimated future cash flows based on a detailed cash flow forecast prepared by the relevant reporting unit, market multiples from similar transactions and quoted market prices of relevant public companies. If the fair value of a reporting unit is less than its carrying value, an impairment loss, if any, is recorded for the difference between the implied fair value and the carrying value of the reporting unit's goodwill.

The Company's indefinite-lived intangible assets consist of trademarks and brands. The estimated fair values of these intangible assets are determined based on a relief-of-royalty income approach derived from internally forecasted revenues of the related products. If the fair value of the trademark or brand is less than its carrying value, an impairment loss is recorded for the difference between the estimated fair value and carrying value of the intangible asset.

Amortization and impairment of goodwill and other intangible assets for the years ended December 31, 2012, 2011 and 2010 were as follows:

In millions	2012		2011		2010
Goodwill:
Impairment	$	1	$	—	$	—
Intangible Assets:
Amortization	288		255		207
Impairment	1		—		1
	$	290	$	255	$	208

Income from discontinued operations included no intangible asset amortization in 2012, $3 million in 2011 and $6 million in 2010.

The Company performed its annual impairment assessment of goodwill and indefinite-lived intangible assets in the third quarter of 2012, 2011 and 2010. In the third quarter of 2012, these assessments resulted in a goodwill impairment charge of approximately $1 million related to the pressure sensitive adhesives reporting unit in the Power Systems & Electronics segment and an intangible asset impairment charge of approximately $1 million related to an international reporting unit in the Food Equipment segment. There were no impairment charges in 2011. In 2010, there was an intangible asset impairment charge of approximately $1 million related to the test and measurement reporting unit in the All Other segment.

A summary of goodwill and indefinite-lived intangible assets that were adjusted to fair value and the related impairment charges included in earnings for 2012, 2011 and 2010 is as follows:

	2012						2011						2010
In millions	Book Value		Fair Value		Total Impairment Charges		Book Value		Fair Value		Total Impairment Charges		Book Value		Fair Value		Total Impairment Charges
Goodwill	$	146	$	145	$	1	$	—	$	—	$	—	$	—	$	—	$	—
Indefinite-lived intangible assets	5		4		1		—		—		—		20		19		1

56

The changes in the carrying amount of goodwill for the years ended December 31, 2012 and 2011 were as follows:

In millions	Transpor-tation			Power Systems & Electronics			Industrial Packaging			Food Equipment			Construction Products			Polymers & Fluids			Decorative Surfaces			All Other			Total
Balance, December 31, 2010	$	567		$	429		$	769		$	204		$	585		$	844		$	13		$	1,561		$	4,972
2011 activity:
Acquisitions & divestitures	118			242			25			(1		)	6			50			—			24			464
Impairment charges	—			—			—			—			—			—			—			—			—
Foreign currency translation	(9		)	(3		)	(11		)	(4		)	(1		)	(17		)	—			(3		)	(48		)
Transfer to assets held for sale	—			(7		)	—			—			—			—			—			(183		)	(190		)
Intersegment goodwill transfers	1			342			—			—			—			(156		)	—			(187		)	—
Balance, December 31, 2011	$	677		$	1,003		$	783		$	199		$	590		$	721		$	13		$	1,212		$	5,198
2012 activity:
Acquisitions & divestitures	8			19			(6		)	1			6			38			(13		)	231			284
Impairment charges	—			(1		)	—			—			—			—			—			—			(1		)
Foreign currency translation	11			8			10			3			7			(2		)	—			12			49
Intersegment goodwill transfers	78			53			(52		)	—			—			(43		)	—			(36		)	—
Balance, December 31, 2012	$	774		$	1,082		$	735		$	203		$	603		$	714		$	—		$	1,419		$	5,530
Accumulated goodwill impairment charges, December 31, 2012	$	36		$	89		$	114		$	60		$	7		$	15		$	—		$	46		$	367

The Company periodically makes changes to its management reporting structure to better align its businesses with Company objectives and operating strategies. In 2011 and 2012, the Company made certain changes in its management reporting structure that resulted in changes in some of the reportable segments. Accordingly, the Company reallocated goodwill between segments based on these changes which did not result in any goodwill impairment charges in 2011 or 2012. See the Segment Information note for further discussion of these segment changes.

Intangible assets as of December 31, 2012 and 2011 were as follows:

	2012							2011
In millions	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Amortizable intangible assets:
Customer lists and relationships	$	1,749	$	(661	)	$	1,088	$	1,608	$	(522	)	$	1,086
Patents and proprietary technology	593		(285		)	308		561		(236		)	325
Trademarks and brands	747		(206		)	541		700		(157		)	543
Software	206		(188		)	18		201		(172		)	29
Noncompete agreements	204		(157		)	47		181		(148		)	33
Other	121		(109		)	12		117		(103		)	14
Total amortizable intangible assets	3,620		(1,606		)	2,014		3,368		(1,338		)	2,030
Indefinite-lived intangible assets:
Trademarks and brands	244		—			244		203		—			203
Total intangible assets	$	3,864	$	(1,606	)	$	2,258	$	3,571	$	(1,338	)	$	2,233

Amortizable intangible assets are being amortized primarily on a straight-line basis over their estimated useful lives of 3 to 20 years.

The estimated amortization expense of intangible assets for the future years ending December 31 is as follows:

In millions
2013	$	265
2014	249
2015	235
2016	221
2017	201

57

On January 1, 2012, the Company adopted new accounting guidance which provides the option to first assess qualitative factors in determining whether it is necessary to perform the two-step test for goodwill impairment.  Under the new guidance, further testing using the two-step test would only be required when, based on the qualitative assessment, it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount.  The adoption of the new accounting guidance did not impact the Company's consolidated financial statements.

Other Assets as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Cash surrender value of life insurance policies	$	391	$	371
Equity investment in Wilsonart	174		—
Customer tooling	107		81
Prepaid pension assets	57		41
Other	301		143
	$	1,030	$	636

Pension and Other Postretirement Benefits—The Company has both funded and unfunded defined benefit pension and other postretirement benefit plans, predominately in the U.S. covering a majority of U.S. employees.

The U.S. primary pension plan provides benefits based on years of service and final average salary. The U.S. primary postretirement health care plan is contributory with the participants’ contributions adjusted annually. The U.S. primary postretirement life insurance plan is noncontributory.

Beginning January 1, 2007, the U.S. primary pension and other postretirement benefit plans were closed to new participants. Newly hired employees and employees from acquired businesses that are not participating in these plans are eligible for additional Company contributions under the existing U.S. primary defined contribution retirement plans. The Company’s expense related to defined contribution plans was $82 million in 2012, $78 million in 2011 and $69 million in 2010.

In addition to the U.S. plans, the Company also has defined benefit pension plans in certain other countries, mainly the United Kingdom, Switzerland, Canada and Germany.

Summarized information regarding the Company’s significant defined benefit pension and other postretirement benefit plans related to both continuing and discontinued operations is as follows:

	Pension									Other Postretirement Benefits
In millions	2012			2011			2010			2012			2011			2010
Components of net periodic benefit cost:
Service cost	$	100		$	94		$	94		$	13		$	14		$	14
Interest cost	107			116			110			27			30			30
Expected return on plan assets	(157		)	(157		)	(150		)	(20		)	(21		)	(18		)
Amortization of actuarial loss	57			39			26			1			—			—
Amortization of prior service cost	1			1			1			3			6			6
Settlement/curtailment loss	14			—			1			—			—			—
	$	122		$	93		$	82		$	24		$	29		$	32

Net periodic benefit cost was included in the statement of income as follows:

	Pension						Other Postretirement Benefits
In millions	2012		2011		2010		2012		2011		2010
Income from continuing operations	$	121	$	89	$	80	$	24	$	29	$	32
Income from discontinued operations	1		4		2		—		—		—
	$	122	$	93	$	82	$	24	$	29	$	32

58

The following tables provide a rollforward of the plan benefit obligations, plan assets and a reconciliation of funded status for the years ended December 31, 2012 and 2011:

	Pension						Other Postretirement Benefits
In millions	2012			2011			2012			2011
Change in benefit obligation:
Benefit obligation at January 1	$	2,465		$	2,301		$	569		$	559
Service cost	100			94			13			14
Interest cost	107			116			27			30
Plan participants’ contributions	6			8			15			15
Amendments	5			—			—			—
Actuarial loss	204			79			45			—
Acquisitions/divestitures	(74		)	16			—			—
Benefits paid	(196		)	(142		)	(45		)	(48		)
Medicare subsidy received	—			—			3			3
Liabilities from (to) other immaterial plans	—			2			—			(4		)
Settlement/curtailment loss (gain)	5			—			(38		)	—
Foreign currency translation	33			(9		)	—			—
Benefit obligation at December 31	$	2,655		$	2,465		$	589		$	569

Change in plan assets:
Fair value of plan assets at January 1	$	2,054		$	1,941		$	297		$	294
Actual return on plan assets	240			108			31			3
Company contributions	190			131			30			33
Plan participants’ contributions	6			8			15			15
Acquisitions/divestitures	(38		)	15			—			—
Benefits paid	(196		)	(142		)	(45		)	(48		)
Foreign currency translation	32			(7		)	—			—
Fair value of plan assets at December 31	$	2,288		$	2,054		$	328		$	297
Funded status	$	(367	)	$	(411	)	$	(261	)	$	(272	)
Other immaterial plans	(58		)	(63		)	(7		)	(7		)
Net liability at December 31	$	(425	)	$	(474	)	$	(268	)	$	(279	)
The amounts recognized in the statement of financial position as of December 31 consist of:
Other assets	$	57		$	41		$	—		$	—
Accrued expenses	(12		)	(21		)	(7		)	(7		)
Liabilities held for sale	—			(13		)	—			—
Other noncurrent liabilities	(470		)	(481		)	(261		)	(272		)
Net liability at end of year	$	(425	)	$	(474	)	$	(268	)	$	(279	)
The pre-tax amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss	$	892		$	848		$	10		$	15
Prior service cost	7			4			2			5
	$	899		$	852		$	12		$	20
Accumulated benefit obligation	$	2,358		$	2,193
Plans with accumulated benefit obligation in excess of plan assets as of December 31:
Projected benefit obligation	$	1,928		$	1,838
Accumulated benefit obligation	$	1,741		$	1,665
Fair value of plan assets	$	1,524		$	1,414

59

Assumptions

The weighted-average assumptions used in the valuations of pension and other postretirement benefits were as follows:

	Pension						Other Postretirement Benefits
	2012		2011		2010		2012		2011		2010
Assumptions used to determine benefit obligations at December 31:
Discount rate	3.85	%	4.64	%	5.05	%	4.15	%	4.95	%	5.45	%
Rate of compensation increases	3.86	%	3.86	%	3.94	%	—	%	—	%	—	%
Assumptions used to determine net periodic benefit cost for years ended December 31:
Discount rate	4.64	%	5.05	%	5.57	%	4.95	%	5.45	%	5.80	%
Expected return on plan assets	7.23	%	7.39	%	7.63	%	7.00	%	7.00	%	7.00	%
Rate of compensation increases	3.86	%	3.94	%	4.18	%	—	%	—	%	—	%

The expected long-term rates of return for pension and other postretirement benefit plans were developed using historical asset class returns while factoring in current market conditions such as inflation, interest rates and asset class performance.

Assumed health care cost trend rates have an effect on the amounts reported for the postretirement health care benefit plans. The assumed health care cost trend rates used to determine the postretirement benefit obligation at December 31 were as follows:

	2012		2011		2010
Health care cost trend rate assumed for the next year	7.35	%	8.50	%	8.71	%
Ultimate trend rate	5.00	%	5.00	%	5.00	%
Year the rate reaches the ultimate trend rate	2019		2019		2020

A one percentage-point change in assumed health care cost trend rates would have the following impact:

In millions	1 Percentage-Point Increase		1 Percentage-Point Decrease
Change in service cost and interest cost for 2012	$	1	$	(1	)
Change in postretirement benefit obligation at December 31, 2012	$	13	$	(16	)

Plan Assets

The Company’s overall investment strategy for the assets in the pension funds is to achieve a balance between the goals of growing plan assets and keeping risk at a reasonable level over a long-term investment horizon. In order to reduce unnecessary risk, the pension funds are diversified across several asset classes, securities and investment managers. The target allocations for plan assets are 50% to 65% equity securities, 30% to 45% debt securities and 0% to 10% in other types of investments. The Company does not use derivatives for the purpose of speculation, leverage, circumventing investment guidelines or taking risks that are inconsistent with specified guidelines.

The assets in the Company’s postretirement health care plan are primarily invested in life insurance policies. The Company’s overall investment strategy for the assets in the postretirement health care fund is to invest in assets that provide a reasonable tax exempt rate of return while preserving capital.

The following tables present the fair value of the Company’s pension and other postretirement benefit plan assets at December 31, 2012 and 2011, by asset category and valuation methodology. Level 1 assets are valued using unadjusted quoted prices for identical assets in active markets. Level 2 assets are valued using quoted prices or other observable inputs for similar assets. Level 3 assets are valued using unobservable inputs, but reflect the assumptions market participants would be expected to use in pricing the assets. Each financial instrument’s categorization is based on the lowest level of input that is significant to the fair value measurement.

60

	2012
In millions	Level 1		Level 2		Level 3		Total
Pension Plan Assets:
Cash and equivalents	$	26	$	—	$	—	$	26
Equity securities:
Domestic	56		—		—		56
Foreign	85		—		—		85
Fixed income securities:
Government securities	—		245		—		245
Corporate debt securities	—		263		—		263
Mortgage-backed securities	—		12		—		12
Investment contracts with insurance companies	—		—		75		75
Commingled funds:
Mutual funds	387		—		—		387
Collective trust funds	—		1,055		—		1,055
Partnerships/private equity interests	—		—		84		84
	$	554	$	1,575	$	159	$	2,288
Other Postretirement Benefit Plan Assets:
Cash and equivalents	$	34	$	—	$	—	$	34
Life insurance policies	—		—		294		294
	$	34	$	—	$	294	$	328

	2011
In millions	Level 1		Level 2		Level 3		Total
Pension Plan Assets:
Cash and equivalents	$	17	$	—	$	—	$	17
Equity securities:
Domestic	56		—		—		56
Foreign	68		—		—		68
Fixed income securities:
Government securities	—		218		—		218
Corporate debt securities	—		240		4		244
Mortgage-backed securities	—		16		—		16
Investment contracts with insurance companies	—		—		69		69
Commingled funds:
Mutual funds	345		—		—		345
Collective trust funds	—		932		—		932
Partnerships/private equity interests	—		—		87		87
Other	—		1		1		2
	$	486	$	1,407	$	161	$	2,054
Other Postretirement Benefit Plan Assets:
Cash and equivalents	$	34	$	—	$	—	$	34
Life insurance policies	—		—		263		263
	$	34	$	—	$	263	$	297

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Cash and equivalents include cash on hand and investments with maturities of 90 days or less and are valued at cost, which approximates fair value. Equity securities primarily include common and preferred equity securities covering a wide range of industries and geographies which are traded in active markets and are valued based on quoted prices. Fixed income securities primarily consist of U.S. and foreign government bills, notes and bonds, corporate debt securities, asset-backed securities and investment contracts. The majority of the assets in this category are valued by evaluating bid prices provided by independent financial data services. For securities where market data is not readily available, unobservable market data is used to value the security. Commingled funds include investments in public and private pooled funds. Mutual funds are traded in active markets and are valued based on quoted prices. The underlying investments include small-cap equity, international equity and long- and short-term fixed income instruments. Collective trust funds are private funds that are valued at the net asset value, which is determined based on the fair value of the underlying investments. The underlying investments include both passively and actively managed U.S. and foreign large- and mid-cap equity funds and short-term investment funds. Partnerships/private equity interests are investments in partnerships where the benefit plan is a limited partner. The investments are valued by the investment managers on a periodic basis using pricing models that use market, income and cost valuation methods. Life insurance policies are used to fund other postretirement benefits in order to obtain favorable tax treatment and are valued based on the cash surrender value of the underlying policies.

The following table presents a reconciliation of Level 3 assets measured at fair value for pension and other postretirement benefit plans during the years ended December 31, 2012 and 2011:

In millions	Government Securities			Corporate Debt Securities			Investment Contracts with Insurance Companies		Partnerships/ Private  Equity Interests			Life Insurance Policies			Other			Total
Balance Dec 31, 2010	$	1		$	3		$	—	$	78		$	265		$	—		$	347
2011 Activity:
Realized gains (losses)	—			—			—		4			—			—			4
Unrealized gains (losses)	—			—			6		4			(2		)	—			8
Purchases (sales)	—			2			2		1			—			1			6
Transfers	(1		)	(1		)	61		—			—			—			59
Balance Dec 31, 2011	—			4			69		87			263			1			424
2012 Activity:
Unrealized gains (losses)	—			—			5		4			31			—			40
Purchases (sales)	—			—			1		(7		)	—			—			(6		)
Transfers	—			(4		)	—		—			—			(1		)	(5		)
Balance Dec 31, 2012	$	—		$	—		$	75	$	84		$	294		$	—		$	453

Cash Flows

The Company generally funds its pension and other postretirement benefit plans as required by law or to the extent such contributions are tax deductible. The Company expects to contribute approximately $132 million to its pension plans and $9 million to its other postretirement benefit plans in 2013.

62

The Company’s portion of the benefit payments that are expected to be paid during the years ending December 31 is as follows:

			Other Postretirement
In millions	Pension		Benefits
2013	$	213	$	38
2014	195		39
2015	174		39
2016	180		40
2017	188		41
Years 2018-2022	974		210

Short-Term Debt as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Commercial paper	$	408	$	192
Bank overdrafts	40		38
Current maturities of long-term debt	6		262
Other borrowings	5		10
	$	459	$	502

The Company has committed credit facilities that support the issuance of commercial paper. See the Long-Term Debt note for further discussion. Commercial paper is stated at cost, which approximates fair value.

The weighted-average interest rate on commercial paper was 0.2% at December 31, 2012 and 0.1% at December 31, 2011. The weighted-average interest rate on other borrowings was 0.6% at December 31, 2012 and 11.2% at December 31, 2011.

As of December 31, 2012, the Company had unused capacity of approximately $248 million under international debt facilities.

Accrued Expenses as of December 31, 2012 and 2011 consisted of accruals for:

In millions	2012		2011
Compensation and employee benefits	$	529	$	551
Deferred revenue and customer deposits	243		245
Rebates	137		162
Warranties	51		55
Current portion of pension and other postretirement benefit obligations	19		28
Other	413		394
	$	1,392	$	1,435

The Company accrues for product warranties based on historical experience. The changes in accrued warranties during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	55		$	64		$	62
Charges	(44		)	(47		)	(43		)
Provision charged to expense	44			37			45
Acquisitions and divestitures	(4		)	3			1
Foreign currency translation	—			—			(1		)
Transfer to liabilities held for sale	—			(2		)	—
Ending balance	$	51		$	55		$	64

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Long-Term Debt at carrying value and fair value as of December 31, 2012 and 2011 consisted of the following:

	2012					2011
In millions	Carrying Value			Fair Value		Carrying Value			Fair Value
6.55% preferred debt securities due December 31, 2011	$	—		$	—	$	250		$	250
5.15% notes due April 1, 2014	800			846		800			877
5.25% Euro notes due October 1, 2014	989			1,071		971			1,064
6.25% notes due April 1, 2019	700			877		700			872
4.88% notes due thru December 31, 2020	12			13		22			24
3.375% notes due September 15, 2021	349			381		348			368
4.875% notes due September 15, 2041	641			770		641			761
3.9% notes due September 1, 2042	1,089			1,132		—			—
Other borrowings	15			15		18			18
	$	4,595		$	5,105	$	3,750		$	4,234
Current maturities	(6		)			(262		)
	$	4,589				$	3,488

The approximate fair values of the Company’s long-term debt, including current maturities, were based on a Level 2 valuation model, using observable inputs, which included market rates for comparable instruments as of December 31, 2012 and 2011.

In 2002, a subsidiary of the Company issued $250 million of 6.55% preferred debt securities at 99.849% of face value. The effective interest rate of the preferred debt securities was 6.7%. These preferred debt securities were due and fully paid on the first business day in 2012.

In 2005, the Company issued $54 million of 4.88% notes due through December 31, 2020 at 100% of face value.

In 2007, the Company, through a wholly-owned European subsidiary, issued €750 million of 5.25% Euro notes due October 1, 2014 at 99.874% of face value. The effective interest rate of the notes was 5.3%.

In 2009, the Company issued $800 million of 5.15% redeemable notes due April 1, 2014 at 99.92% of face value and $700 million of 6.25% redeemable notes due April 1, 2019 at 99.98% of face value. The effective interest rates of the notes were 5.2% and 6.3%, respectively.

In 2011, the Company issued $350 million of 3.375% notes due September 15, 2021 at 99.552% of face value and $650 million of 4.875% notes due September 15, 2041 at 98.539% of face value. The effective interest rates of the notes were 3.4% and 4.9%, respectively. These notes are senior unsecured obligations, ranking equal in right of payment with all other senior unsecured indebtedness of the Company.

In 2012, the Company issued $1.1 billion of 3.9% notes due September 1, 2042 at 99.038% of face value. The effective interest rate of the notes was 3.955%. These notes are senior unsecured obligations, ranking equal in right of payment with all other senior unsecured indebtedness of the Company.

Other debt outstanding at December 31, 2012 bears interest at rates ranging from 0.3% to 17.5%, with maturities through the year 2029.

On June 8, 2012, the Company entered into a $1.5 billion line of credit agreement with a termination date of June 8, 2017. In connection with the new line of credit, the Company terminated its $500 million revolving credit facility with a termination date of June 15, 2012 and its $1.0 billion line of credit agreement with a termination date of June 11, 2013. In 2010, the Company entered into a $1.0 billion line of credit agreement with a termination date of June 10, 2011, which was replaced in June of 2011 by a $1.0 billion line of credit with a termination date of June 10, 2016. These lines of credit support the issuance of commercial paper. No amounts were outstanding under either of the outstanding facilities at December 31, 2012.

The financial covenants in the Company's debt agreements limit total debt, including guarantees, to 50% of total capitalization. The Company’s total debt, including guarantees, was 34.3% of total capitalization as defined in the Company's debt agreements as of December 31, 2012, which was in compliance with these covenants.

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Scheduled maturities of long-term debt for the future years ending December 31 are as follows:

In millions
2013	$	6
2014	1,793
2015	2
2016	1
2017	1
2018 and future years	2,792
	$	4,595

At December 31, 2012, the Company had open stand-by letters of credit of approximately $194 million, substantially all of which expire in 2013 and 2014.

Other Noncurrent Liabilities at December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Pension benefit obligation	$	470	$	481
Postretirement benefit obligation	261		272
Other	524		615
	$	1,255	$	1,368

Commitments and Contingencies—The Company is subject to various legal proceedings and claims that arise in the ordinary course of business, including those involving environmental, product liability (including toxic tort) and general liability claims. The Company accrues for such liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Such accruals are based on developments to date, the Company’s estimates of the outcomes of these matters and its experience in contesting, litigating and settling other similar matters. The Company believes resolution of these matters, individually and in the aggregate, will not have a material adverse effect on the Company’s financial position, liquidity or future operations.

Among the toxic tort cases in which the Company is a defendant, the Company and its subsidiaries Hobart Brothers Company and Miller Electric Mfg. Co. have been named, along with numerous other defendants, in lawsuits alleging injury from exposure to welding consumables. The plaintiffs in these suits claim unspecified damages for injuries resulting from the plaintiffs’ alleged exposure to asbestos, manganese and/or toxic fumes in connection with the welding process. In the first quarter of 2012, the Company entered into an agreement resolving substantially all of the manganese-related claims for an immaterial amount. As of December 31, 2012, a majority of the cases against the Company, Hobart Brothers and Miller Electric have been dismissed. The Company believes that the remaining claims will not have a material adverse effect on the Company’s operating results, financial position or cash flows. The Company has not recorded any significant reserves related to these cases.  

Preferred Stock, without par value, of which 0.3 million shares are authorized and unissued, is issuable in series. The Board of Directors is authorized to fix by resolution the designation and characteristics of each series of preferred stock. The Company has no present commitment to issue its preferred stock.

Common Stock, with a par value of $0.01, Additional Paid-In-Capital and Common Stock Held in Treasury transactions during 2012, 2011 and 2010 are shown below.

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	Common Stock			Additional Paid-In- Capital			Common Stock Held in Treasury
In millions	Shares	Amount		Amount			Shares		Amount
Balance, December 31, 2009	535.0	$	5	$	271		(32.7	)	$	(1,391	)
During 2010—
Shares issued for stock options	3.5	—		114			—		—
Shares issued for stock compensation and vesting of restricted stock	—	—		1			—		—
Stock compensation expense	—	—		56			—		—
Noncontrolling interest	—	—		—			—		—
Tax benefits related to stock options	—	—		16			—		—
Tax benefits related to defined contribution plans	—	—		3			—		—
Repurchases of common stock	—	—		—			(8.1	)	(350		)
Balance, December 31, 2010	538.5	5		461			(40.8	)	(1,741		)
During 2011—
Shares issued for stock options	3.9	—		151			—		—
Shares issued for stock compensation and vesting of restricted stock	0.1	—		2			—		(1		)
Stock compensation expense	—	—		56			—		—
Noncontrolling interest	—	—		—			—		—
Tax benefits related to stock options	—	—		13			—		—
Tax benefits related to defined contribution plans	—	—		3			—		—
Repurchases of common stock	—	—		—			(18.1	)	(950		)
Balance, December 31, 2011	542.5	5		686			(58.9	)	(2,692		)
During 2012—
Shares issued for stock options	6.3	—		285			—		—
Shares withheld for taxes	—	—		1			(0.3	)	(19		)
Shares issued for stock compensation and vesting of restricted stock	0.8	—		(10		)	0.2		9
Stock compensation expense	—	—		54			—		—
Noncontrolling interest	—	—		(22		)	—		—
Tax benefits related to stock options	—	—		14			—		—
Tax benefits related to defined contribution plans	—	—		4			—		—
Repurchases of common stock	—	—		—			(35.5	)	(2,020		)
Balance, December 31, 2012	549.6	$	5	$	1,012		(94.5	)	$	(4,722	)
Authorized, December 31, 2012	700.0

On August 20, 2007, the Company’s Board of Directors authorized a stock repurchase program which provided for the buyback of up to $3.0 billion of the Company’s common stock over an open-ended period of time (the “2007 Program”). Under the 2007 Program, the Company made repurchases of 8.1 million shares of its common stock at an average price of $43.29 per share during 2010 and 16.3 million shares of its common stock at an average price of $53.51 per share during 2011. As of December 31, 2011, there were no authorized repurchases remaining under the 2007 Program.

On May 6, 2011, the Company’s Board of Directors authorized a new stock repurchase program which provides for the buyback of up to an additional $4.0 billion of the Company’s common stock over an open-ended period of time (the “2011 Program”). Under the 2011 Program, the Company made repurchases of 1.8 million shares of its common stock at an average price of $43.20 per share during 2011 and 35.5 million shares of its common stock at an average price of $56.93 per share during 2012. As of December 31, 2012, there was approximately $1.9 billion of authorized repurchases remaining under the 2011 Program.

66

Cash Dividends declared were $1.48 per share in 2012, $1.40 per share in 2011 and $1.30 per share in 2010. Cash dividends paid were $1.84 per share in 2012, which included an accelerated dividend payment of $0.38 per share in December 2012 which was originally scheduled to be paid in January 2013, $1.38 per share in 2011 and $1.27 per share in 2010.

Accumulated Other Comprehensive Income—The changes in accumulated other comprehensive income during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	224		$	427		$	249
Foreign currency translation adjustments	94			(141		)	153
Pension and other postretirement benefits actuarial gains (losses), net of tax of $55 million in 2012, $54 million in 2011 and $(3) million in 2010	(104		)	(93		)	4
Amortization of unrecognized pension and other postretirement benefits costs, net of tax of $(22) million in 2012, $(17) million in 2011 and $(12) million in 2010	40			31			21
Pension and other postretirement benefits settlements, curtailments and other, net of tax of $(21) million in 2012	39			—			—
Ending balance	$	293		$	224		$	427

Foreign currency translation adjustments for the year ended December 31, 2011 is net of a $55 million increase for the resolution of an issue with the Internal Revenue Service in the U.S. related to a deduction for foreign exchange losses on an intercompany loan.

As of December 31, 2012 and 2011, the ending balance of accumulated other comprehensive income consisted of cumulative translation adjustment income of $867 million and $773 million, respectively, and unrecognized pension and other postretirement benefits costs of $574 million and $549 million, respectively. The estimated unrecognized benefit cost that will be amortized from accumulated other comprehensive income into net periodic benefit cost in 2013 is $76 million for pension and $2 million for other postretirement benefits.

Stock-Based Compensation—Stock options and restricted stock units have been issued to officers and other management employees under ITW’s 2011 Long-Term Incentive Plan (the “Plan”). The stock options generally vest over a four-year period and have a maturity of ten years from the issuance date. Restricted stock units generally vest after a three-year period and include units with and without performance criteria. To cover the exercise of vested options and vesting of restricted stock units, the Company generally has issued new shares from its authorized but unissued share pool. At December 31, 2012, 43.6 million shares of ITW common stock were reserved for issuance under the Plan. The Company records compensation expense for the grant date fair value of stock awards over the remaining service periods of those awards.

The following summarizes the Company’s stock-based compensation expense:

In millions	2012			2011			2010
Pre-tax compensation expense	$	54		$	56		$	56
Tax benefit	(19		)	(17		)	(18		)
Total stock-based compensation recorded as expense, net of tax	$	35		$	39		$	38

The following table summarizes activity related to non-vested restricted stock units during 2012:

Shares in millions	Number of Shares		Weighted-Average Grant-Date Fair Value
Unvested, January 1, 2012	2.2		$39.27
Granted	0.5		51.39
Vested	(1.0	)	31.69
Canceled	(0.1	)	45.97
Unvested, December 31, 2012	1.6		47.36

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The following table summarizes stock option activity under the Plan for the year ended December 31, 2012:

In millions except exercise price and contractual terms	Number of Shares		Weighted-Average Exercise Price	Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value
Under option, January 1, 2012	17.5		$46.57
Granted	1.8		55.72
Exercised	(6.3	)	45.23
Canceled or expired	(0.2	)	48.33
Under option, December 31, 2012	12.8		48.50	6.0 years	$157
Exercisable, December 31, 2012	9.5		47.49	5.3 years	$127

The Company's annual equity awards consist of stock options, restricted stock units (“RSUs”) and performance restricted stock units (“PRSUs”). The RSUs provide for full “cliff” vesting three years from the date of grant. The PRSUs provide for full “cliff” vesting after three years if the Compensation Committee certifies that the performance goals set with respect to the PRSUs have been met. Upon vesting, the holder will receive one share of common stock of the Company for each vested RSU or PRSU. Option exercise prices are equal to the common stock fair market value on the date of grant. The fair value of RSUs and PRSUs is determined by reducing the closing market price on the date of the grant by the present value of projected dividends over the vesting period. The Company uses a binomial option pricing model to estimate the fair value of the stock options granted. The following summarizes the assumptions used in the models:

	2012	2011	2010
Risk-free interest rate	0.2-2.1%	0.3-3.8%	0.4-3.9%
Weighted-average volatility	25.0%	25.0%	25.0%
Dividend yield	2.61%	2.80%	2.78%
Expected years until exercise	7.6-7.8	7.6-7.9	7.5-7.8

Lattice-based option valuation models, such as the binomial option pricing model, incorporate ranges of assumptions for inputs. The risk-free rate of interest for periods within the contractual life of the option is based on a zero-coupon U.S. government instrument over the contractual term of the equity instrument. Expected volatility is based on implied volatility from traded options on the Company’s stock and historical volatility of the Company’s stock. The Company uses historical data to estimate option exercise timing and employee termination rates within the valuation model. The weighted-average dividend yield is based on historical information. The expected term of options granted is derived from the output of the option valuation model and represents the period of time that options granted are expected to be outstanding. The ranges presented result from separate groups of employees assumed to exhibit different behavior.

The weighted-average grant-date fair value of options granted during 2012, 2011 and 2010 was $11.48, $12.34 and $9.59 per share, respectively. The aggregate intrinsic value of options exercised during the years ended December 31, 2012, 2011 and 2010 was $84 million, $63 million and $56 million, respectively. As of December 31, 2012 there was $20 million of total unrecognized compensation cost related to unvested stock options. That cost is expected to be recognized over a weighted-average period of 2.4 years. Exercise of options during the years ended December 31, 2012, 2011 and 2010 resulted in cash receipts of $285 million, $151 million and $114 million, respectively. The total fair value of vested stock option awards during the years ended December 31, 2012, 2011 and 2010 was $48 million, $33 million and $30 million, respectively.

As of December 31, 2012, there was $22 million of total unrecognized compensation cost related to unvested restricted stock units. That cost is expected to be recognized over a weighted-average remaining contractual life of 1.7 years. The total fair value of vested restricted stock unit awards during the years ended December 31, 2012 and 2011 was $31 million and $1 million, respectively.

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Segment Information—The Company has 40 operating segments which are aggregated from the Company's more than 750 operations in 58 countries. These businesses are internally reported as 40 operating segments to senior management and have been aggregated into the following seven external reportable segments: Transportation; Power Systems & Electronics; Industrial Packaging; Food Equipment; Construction Products; Polymers & Fluids; and All Other.

As discussed in the Divestiture of Majority Interest in Decorative Surfaces Segment note, the Company ceased consolidating the results of the Decorative Surfaces segment as of October 31, 2012 and now reports its 49% ownership interest in Wilsonart using the equity method of accounting. Effective November 1, 2012, the Company made changes to its management reporting structure and Decorative Surfaces is no longer a reportable segment of the Company.

Transportation—Transportation-related components, fasteners, fluids and polymers, as well as truck remanufacturing and related parts and service.

Power Systems & Electronics—Equipment and consumables associated with specialty power conversion, metallurgy and electronics.

Industrial Packaging—Steel, plastic and paper products and equipment used for bundling, shipping and protecting goods in transit.

Food Equipment—Commercial food equipment and related service.

Construction Products—Construction fastening systems and truss products.

Polymers & Fluids—Adhesives, sealants, lubrication and cutting fluids, and hygiene products.

All Other—All other operating segments.

Segment information for 2012, 2011 and 2010 was as follows:

69

In millions	2012			2011			2010
Operating revenues:
Transportation	$	3,550		$	3,444		$	2,839
Power Systems & Electronics	3,151			2,988			2,518
Industrial Packaging	2,412			2,463			2,123
Food Equipment	1,939			1,985			1,860
Construction Products	1,902			1,959			1,753
Polymers & Fluids	1,230			1,250			1,001
All Other	2,883			2,690			2,407
Intersegment revenues	(64		)	(76		)	(77		)
Total Segments	$	17,003		$	16,703		$	14,424
Decorative Surfaces	921			1,084			992
Total	$	17,924		$	17,787		$	15,416
Operating income:
Transportation	$	560		$	539		$	427
Power Systems & Electronics	643			605			493
Industrial Packaging	282			249			208
Food Equipment	324			304			255
Construction Products	200			225			192
Polymers & Fluids	195			188			167
All Other	521			489			395
Total Segments	$	2,725		$	2,599		$	2,137
Decorative Surfaces	122			132			117
Total	$	2,847		$	2,731		$	2,254
Depreciation and amortization and impairment of goodwill and intangible assets:
Transportation	$	144		$	132		$	105
Power Systems & Electronics	96			90			82
Industrial Packaging	66			69			67
Food Equipment	47			50			44
Construction Products	57			58			59
Polymers & Fluids	49			48			38
All Other	136			125			134
Total Segments	$	595		$	572		$	529
Decorative Surfaces	18			22			20
Total	$	613		$	594		$	549
Plant and equipment additions:
Transportation	$	127		$	105		$	74
Power Systems & Electronics	52			43			27
Industrial Packaging	40			27			34
Food Equipment	34			36			31
Construction Products	28			37			28
Polymers & Fluids	21			22			14
All Other	62			60			57
Total Segments	$	364		$	330		$	265
Decorative Surfaces	18			23			23
Total	$	382		$	353		$	288
Identifiable assets:
Transportation	$	2,981		$	2,835
Power Systems & Electronics	2,451			2,516
Industrial Packaging	1,786			1,825
Food Equipment	979			1,022
Construction Products	1,463			1,505
Polymers & Fluids	1,322			1,340
All Other	2,975			2,539
Total Segments	$	13,957		$	13,582
Corporate	5,352			3,616
Assets held for sale	—			386
Decorative Surfaces	—			400
Total	$	19,309		$	17,984

70

Identifiable assets by segment are those assets that are specifically used in that segment. Corporate assets are principally cash and equivalents, investments and other general corporate assets.

2011 and 2012 Segment Changes—In the first quarter of 2011, the Company made certain changes in its management reporting structure that resulted in changes in some of the reportable segments. The pressure sensitive adhesives, and the static and contamination control reporting units were moved to the Power Systems & Electronics segment from the Polymers & Fluids and All Other segments, respectively. The changes in the reportable segments and underlying reporting units did not result in any goodwill impairment charges in the first quarter of 2011.

In the first quarter of 2012, the Company made certain changes in its management reporting structure that resulted in changes in some of the reportable segments. These changes primarily related to the industrial fasteners reporting unit, formerly in the All Other segment, moving to the Transportation segment; certain businesses in a Latin American reporting unit, formerly in the Polymers & Fluids segment, moving to the Transportation segment; and a worldwide insulation reporting unit, formerly in the Industrial Packaging segment, moving to the Power Systems & Electronics segment. The changes in the reportable segments and underlying reporting units did not result in any goodwill impairment charges in the first quarter of 2012.

2013 Segment Changes—Effective January 1, 2013, the Company made certain changes in how its operations are reported to senior management in order to better align its portfolio of businesses with its enterprise-wide portfolio management initiative.

As a result of this reorganization, the Company's operations will be prospectively aggregated into the following eight external reportable segments: Industrial Packaging; Test & Measurement and Electronics; Automotive OEM; Polymers & Fluids; Food Equipment; Construction Products; Welding; and Specialty Products.

The significant changes resulting from this reorganization include the following:

• Certain businesses within the former Transportation segment, primarily related to the automotive aftermarket business, will be reported in the Polymers & Fluids segment and the Transportation segment will be renamed Automotive OEM.

• The Welding business, which was formerly reported in the Power Systems & Electronics segment, will be reported separately as the Welding segment.

• The Electronics business, which was formerly reported in the Power Systems & Electronics segment, will be combined with the Test & Measurement business, which was formerly reported in the All Other segment, to form a new Test & Measurement and Electronics segment.

• The All Other segment will be renamed Specialty Products.

The 2012 Annual Report on Form 10-K has not been restated for these changes in segment reporting. Results for 2012 and prior periods are reported on the basis under which the Company managed its business in 2012 and do not reflect the January 2013 reorganization described above.

Enterprise-wide information for 2012, 2011 and 2010 was as follows:

In millions	2012		2011		2010
Operating Revenues by Geographic Region:
United States	$	7,714	$	7,379	$	6,462
Europe	5,090		5,492		4,806
Asia	2,097		1,932		1,698
Other North America	1,222		1,161		1,018
Australia/New Zealand	864		885		781
Other	937		938		651
	$	17,924	$	17,787	$	15,416

Operating revenues by geographic region are based on the customers’ locations.

The Company has thousands of product lines within its businesses; therefore, providing operating revenues by product line is not practicable.

Total noncurrent assets excluding deferred tax assets and financial instruments were $11.0 billion and $10.2 billion at December 31, 2012 and 2011, respectively. Of these amounts, approximately 53% and 52% was attributed to U.S. operations for 2012 and 2011, respectively. The remaining amounts were attributed to the Company’s foreign operations, with no single country accounting for a significant portion.

71

QUARTERLY AND COMMON STOCK DATA (UNAUDITED)

Quarterly Financial Data

The unaudited quarterly financial data included as supplementary data reflects all adjustments that are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented.

	Three Months Ended
	March 31				June 30				September 30					December 31
In millions except per share amounts	2012		2011		2012		2011		2012			2011		2012		2011
Operating revenues	$	4,547	$	4,272	$	4,655	$	4,615	$	4,501		$	4,580	$	4,221	$	4,320
Cost of revenues	2,911		2,762		2,964		2,996		2,855			2,962		2,725		2,798
Operating income	705		659		770		711		763			714		609		647
Income from continuing operations	471		606		527		484		525			490		972		437
Income from discontinued operations	15		17		354		15		(1		)	17		7		5
Net income	486		623		881		499		524			507		979		442
Income per share from continuing operations:
Basic	0.98		1.22		1.12		0.97		1.13			1.01		2.12		0.90
Diluted	0.97		1.21		1.11		0.96		1.12			1.00		2.10		0.90
Net income per share:
Basic	1.01		1.25		1.86		1.00		1.13			1.04		2.13		0.91
Diluted	1.00		1.24		1.85		0.99		1.12			1.04		2.11		0.91

In the first quarter of 2011, the Company recorded a favorable discrete non-cash tax benefit of $166 million, or $0.33 per diluted share, associated with an Australian tax matter.

In the second quarter of 2012, the Company recorded an after-tax gain of $361 million, or $0.76 per diluted share, related to the sale of the finishing group of businesses which was included in discontinued operations.

In the fourth quarter of 2012, the Company recorded an after-tax gain of $632 million, or $1.37 per diluted share, in income from continuing operations related to the sale of a 51% majority interest in the Decorative Surfaces segment.

ITEM 9.Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Not applicable.

ITEM 9A.Controls and Procedures

Controls and Procedures

The Company’s management, with the participation of the Company’s President & Chief Executive Officer and Senior Vice President & Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) as of December 31, 2012. Based on such evaluation, the Company’s President & Chief Executive Officer and Senior Vice President & Chief Financial Officer have concluded that, as of December 31, 2012, the Company’s disclosure controls and procedures were effective.

Management Report on Internal Control over Financial Reporting

The Management Report on Internal Control over Financial Reporting and the Report of Independent Registered Public Accounting Firm are found in Item 8. Financial Statements and Supplementary Data.

In connection with the evaluation by management, including the Company’s President & Chief Executive Officer and Senior Vice President & Chief Financial Officer, no changes in the Company’s internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)) during the quarter ended December 31, 2012 were identified that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

ITEM 9B.Other Information

Not applicable.

72

PART III

ITEM 10.Directors, Executive Officers and Corporate Governance

Information regarding the Directors of the Company is incorporated by reference from the information under the captions “Election of Directors” and “Corporate Governance Policies and Practices” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

Information regarding the Audit Committee and its Financial Experts is incorporated by reference from the information under the captions “Board of Directors and Its Committees” and “Audit Committee Report” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

Information regarding the Executive Officers of the Company can be found in Part I of this Annual Report on Form 10-K under the caption “Executive Officers.”

Information regarding compliance with Section 16(a) of the Exchange Act is incorporated by reference from the information under the caption “Section 16(a) Beneficial Ownership Reporting Compliance” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

Information regarding the Company’s code of ethics that applies to the Company’s President & Chief Executive Officer, Senior Vice President & Chief Financial Officer, and key financial and accounting personnel is incorporated by reference from the information under the caption “Corporate Governance Policies and Practices” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

ITEM 11.Executive Compensation

This information is incorporated by reference from the information under the captions “Executive Compensation,” “Director Compensation,” “Compensation Discussion and Analysis” and “Compensation Committee Report” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

ITEM 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

This information is incorporated by reference from the information under the captions “Ownership of ITW Stock” and “Equity Compensation Plan Information” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

ITEM 13.Certain Relationships and Related Transactions, and Director Independence

Information regarding certain relationships and related transactions is incorporated by reference from the information under the captions “Ownership of ITW Stock,” “Certain Relationships and Related Transactions” and “Corporate Governance Policies and Practices” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

Information regarding director independence is incorporated by reference from the information under the captions “Corporate Governance Policies and Practices” and “Categorical Standards for Director Independence” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

ITEM 14. Principal Accounting Fees and Services

This information is incorporated by reference from the information under the caption “Ratification of the Appointment of Independent Registered Public Accounting Firm” in the Company’s Proxy Statement for the 2013 Annual Meeting of Stockholders.

73

PART IV

ITEM 15.Exhibits and Financial Statement Schedules

(a)(1) Financial Statements

The following information is included as part of Item 8. Financial Statements and Supplementary Data:

Management Report on Internal Control over Financial Reporting

Report of Independent Registered Public Accounting Firm

Statement of Income

Statement of Comprehensive Income

Statement of Income Reinvested in the Business

Statement of Financial Position

Statement of Cash Flows

Notes to Financial Statements

(2) Financial Statement Schedules

Not applicable.

(3) Exhibits

(i) See the Exhibit Index within this Annual Report on Form 10-K.

(ii) Pursuant to Regulation S-K, Item 601(b)(4)(iii), the Company has not filed with Exhibit 4 any debt instruments for which the total amount of securities authorized thereunder is less than 10% of the total assets of the Company and its subsidiaries on a consolidated basis as of December 31, 2012, with the exception of the agreements related to the 5.15% Notes due 2014, the 6.25% Notes due 2019, the 3.375% Notes due 2021, the 4.875% Notes due 2041, and the 3.9% Notes due 2042, which are described as Exhibit numbers 4(a) through (g) in the Exhibit Index. The Company agrees to furnish a copy of the agreement related to the debt instruments which have not been filed with Exhibit 4 to the Securities and Exchange Commission upon request.

74

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on this 19th day of February 2013.

ILLINOIS TOOL WORKS INC.
By:	/s/ E. SCOTT SANTI
	E. Scott Santi
	President & Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities indicated on this 19th day of February 2013.

Signatures	Title
/s/ E. SCOTT SANTI	President & Chief Executive Officer, Director
E. Scott Santi	(Principal Executive Officer)
/s/ RONALD D. KROPP	Senior Vice President & Chief Financial Officer
Ronald D. Kropp	(Principal Financial Officer)
/s/ RANDALL J. SCHEUNEMAN	Vice President & Chief Accounting Officer
Randall J. Scheuneman	(Principal Accounting Officer)
DANIEL J. BRUTTO	Director
SUSAN CROWN	Director
DON H. DAVIS, JR.	Director
JAMES W. GRIFFITH	Director
ROBERT C. MCCORMACK	Director
ROBERT S. MORRISON	Chairman of the Board
JAMES A. SKINNER	Director
DAVID B. SMITH, JR.	Director
PAMELA B. STROBEL	Director
KEVIN M. WARREN	Director
ANRÉ D. WILLIAMS	Director
	By /s/ E. SCOTT SANTI
	(E. Scott Santi, as Attorney-in-Fact)

Original powers of attorney authorizing E. Scott Santi to sign the Company’s Annual Report on Form 10-K and amendments thereto on behalf of the above-named directors of the registrant have been filed with the Securities and Exchange Commission as part of this Annual Report on Form 10-K (Exhibit 24).

75

Exhibit Index

Annual Report on Form 10-K

2012

Exhibit Number	Description
2.1	Investment Agreement, dated as of August 15, 2012, among CD&R Wimbledon Holdings III, L.P., a Cayman Islands limited partnership; Illinois Tool Works Inc.; ITW DS Investments Inc., a Delaware corporation; and Wilsonart International Holdings LLC, a Delaware limited liability company, filed as Exhibit 2.1 to the Company's Current Report on Form 8-K filed on August 17, 2012 (Commission File No. 1-4797) and incorporated herein by reference. (Certain of the schedules and similar attachments have been omitted pursuant to Item 601(b)(2) of Regulation S-K, but the Company undertakes to furnish a copy of the schedules or similar attachments to the Securities and Exchange Committee upon request.)
3(a)	Restated Certificate of Incorporation of Illinois Tool Works Inc., filed as Exhibit 3(a) to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2006 (Commission File No. 1-4797) and incorporated herein by reference.
3(b)	By-laws of Illinois Tool Works Inc., as amended and restated as of December 7, 2012, filed as Exhibit 3(b)(ii) to the Company’s Form 8-K filed on December 7, 2012 (Commission File No. 1-4797) and incorporated herein by reference.
4(a)	Indenture between Illinois Tool Works Inc. and The First National Bank of Chicago, as Trustee, dated as of November 1, 1986, filed as Exhibit 4.1 to the Company’s Registration Statement on Form S-3 filed on January 15, 1999 (Commission File No. 333-70691) and incorporated herein by reference.
4(b)	First Supplemental Indenture between Illinois Tool Works Inc. and Harris Trust and Savings Bank, as Trustee, dated as of May 1, 1990, filed as Exhibit 4.2 to the Company’s Registration Statement on Form S-3 filed on January 15, 1999 (Commission File No. 333-70691) and incorporated herein by reference.
4(c)	Officers’ Certificate dated March 26, 2009 establishing the terms, and setting forth the forms, of the 5.15% Notes due 2014 and the 6.25% Notes due 2019 filed as Exhibit 4.3 to the Company’s Current Report on Form 8-K filed on March 27, 2009 (Commission File No. 1-4797) and incorporated herein by reference.
4(d)	Registration Rights Agreement dated March 26, 2009, by and among the Company and HSBC Securities (USA) Inc. and Banc of America Securities LLC filed as Exhibit 4.4 to the Company’s Current Report on Form 8-K filed on March 27, 2009 (Commission File No. 1-4797) and incorporated herein by reference.
4(e)	Officers’ Certificate dated August 31, 2011, establishing the terms, and setting forth the forms, of the 3.375% Notes due 2021 and the 4.875% Notes due 2041, filed as Exhibit 4.3 to the Company’s Form 8-K filed on September 1, 2011 (Commission File No. 001-04797) and incorporated herein by reference.
4(f)	Registration Rights Agreement dated August 31, 2011, by and among the Company and J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, filed as Exhibit 4.4 to the Company’s Form 8-K filed on September 1, 2011 (Commission File No. 001-04797) and incorporated herein by reference.
4(g)	Officers' Certificate dated August 28, 2012, establishing the terms, and setting forth the forms, of the 3.9% Notes due 2042, filed as Exhibit 4.1 to the Company's Current Report on Form 8-K filed on August 28, 2012 (Commission File No. 1-4797) and incorporated herein by reference.
10(a)*	Illinois Tool Works Inc. 1996 Stock Incentive Plan dated February 16, 1996, as amended on December 12, 1997, October 29, 1999, January 3, 2003, March 18, 2003, January 2, 2004, December 10, 2004 and December 7, 2005, filed as Exhibit 10(a) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2005 (Commission File No. 1-4797) and incorporated herein by reference.
10(b)*	Illinois Tool Works Inc. 2006 Stock Incentive Plan dated February 10, 2006, as amended on May 5, 2006, filed as Exhibit 10(a) to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2006 (Commission File No. 1-4797) and incorporated herein by reference.
10(c)*	Amendment to Illinois Tool Works Inc. 2006 Stock Incentive Plan dated February 8, 2008, filed as Exhibit 10(q) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 (Commission File No. 1-4797) and incorporated herein by reference.
10(d)*	Second Amendment to Illinois Tool Works Inc. 2006 Stock Incentive Plan dated February 13, 2009, filed as Exhibit 10(d) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (Commission File No. 1-4797) and incorporated herein by reference.
10(e)*	Illinois Tool Works Inc. 2011 Long-Term Incentive Plan filed as Exhibit 99.2 to the Company’s Current Report on Form 8-K filed on December 16, 2010 (Commission File No. 1-4797) and incorporated herein by reference.
10(f)*	Form of stock option terms filed as Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on December 16, 2004 and incorporated herein by reference.

76

Exhibit Number	Description
10(g)*	Form of stock option terms filed as Exhibit 10(m) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (Commission File No. 1-4797) and incorporated herein by reference.
10(h)*	Form of stock option terms filed as Exhibit 10(o) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 (Commission File No. 1-4797) and incorporated herein by reference.
10(i)*	Form of stock option terms filed as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed on February 5, 2009 (Commission File No. 1-4797) and incorporated herein by reference.
10(j)*	Form of stock option terms filed as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed on February 9, 2011 (Commission File No. 1-4797) and incorporated herein by reference.
10(k)*	Form of stock option terms filed as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed on February 7, 2012 (Commission File No. 1-4797) and incorporated herein by reference.
10(l)*	Form of restricted stock unit terms filed as Exhibit 99.2 to the Company’s Current Report on Form 8-K filed on February 5, 2009 (Commission File No. 1-4797) and incorporated herein by reference.
10(m)*	Form of restricted stock unit terms filed as Exhibit 99.2 to the Company’s Current Report on Form 8-K filed on February 9, 2011 (Commission File No. 1-4797) and incorporated herein by reference.
10(n)*	Form of restricted stock unit terms filed as Exhibit 99.2 to the Company’s Current Report on Form 8-K filed on February 7, 2012 (Commission File No. 1-4797) and incorporated herein by reference.
10(o)*	Form of qualifying or performance restricted stock unit terms filed as Exhibit 10(j) to the Company’s Annual Report on Form 10-K filed on February 26, 2010 (Commission File No. 1-4797) and incorporated herein by reference.
10(p)*	Form of performance restricted stock unit terms filed as Exhibit 99.3 to the Company’s Current Report on Form 8-K filed on February 9, 2011 (Commission File No. 1-4797) and incorporated herein by reference.
10(q)*	Form of performance restricted stock unit terms filed as Exhibit 99.3 to the Company’s Current Report on Form 8-K filed on February 7, 2012 (Commission File No. 1-4797) and incorporated herein by reference.
10(r)*	Form of company-wide growth plan grant filed as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed on March 3, 2010 (Commission File No. 1-4797) and incorporated herein by reference.
10(s)*	Form of company-wide growth plan grant filed as Exhibit 99.4 to the Company’s Current Report on Form 8-K filed on February 9, 2011 (Commission File No. 1-4797) and incorporated herein by reference.
10(t)*	Form of company-wide growth plan grant filed as Exhibit 99.4 to the Company’s Current Report on Form 8-K filed on February 7, 2012 (Commission File No. 1-4797) and incorporated herein by reference.
10(u)*	Illinois Tool Works Inc. Executive Incentive Plan adopted February 16, 1996, filed as Exhibit 10(a) to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-4797) and incorporated herein by reference.
10(v)*	Illinois Tool Works Inc. 2011 Executive Incentive Plan filed as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed on December 16, 2010 (Commission File No. 1-4797) and incorporated herein by reference.
10(w)*	Illinois Tool Works Inc. 1982 Executive Contributory Retirement Income Plan adopted December 13, 1982, filed as Exhibit 10(c) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 1990 (Commission File No. 1-4797) and incorporated herein by reference.
10(x)*	Illinois Tool Works Inc. 1985 Executive Contributory Retirement Income Plan adopted December 1985, filed as Exhibit 10(d) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 1990 (Commission File No. 1-4797) and incorporated herein by reference.
10(y)*	Amendment to the Illinois Tool Works Inc. 1985 Executive Contributory Retirement Income Plan dated May 1, 1996, filed as Exhibit 10(c) to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1996 (Commission File No. 1-4797) and incorporated herein by reference.
10(z)*	Illinois Tool Works Inc. Executive Contributory Retirement Income Plan as amended and restated, effective January 1, 2010, filed as exhibit 10 to the Company’s Current Report on Form 8-K filed on November 5, 2009 (Commission File No. 1-4797) and incorporated herein by reference.
10(aa)*	Illinois Tool Works Inc. Nonqualified Pension Plan, effective January 1, 2008, as amended and approved by the Board of Directors on December 22, 2008, filed as Exhibit 10(p) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (Commission File No. 1-4797) and incorporated herein by reference.

77

Exhibit Number	Description
10(bb)*	Illinois Tool Works Inc. 2011 Change-in-Control Severance Compensation Policy filed as Exhibit 99.3 to the Company’s Current Report on Form 8-K filed on December 16, 2010 (Commission File No. 1-4797) and incorporated herein by reference.
10(cc)*	Illinois Tool Works Inc. Directors’ Deferred Fee Plan effective May 5, 2006, as amended and approved by the Board of Directors on February 9, 2007, filed as Exhibit 10(h) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (Commission File No. 1-4797) and incorporated herein by reference.
10(dd)*	Amendment to the Illinois Tool Works Inc. Directors’ Deferred Fee Plan, effective February 8, 2008, filed as Exhibit 10(j) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 (Commission File No. 1-4797) and incorporated herein by reference.
10(ee)*	Illinois Tool Works Inc. Phantom Stock Plan for Non-Officer Directors, as approved by the Board of Directors on December 5, 2008, filed as Exhibit 10(s) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (Commission File No. 1-4797) and incorporated herein by reference.
10(ff)*	Illinois Tool Works Inc. 2011 Cash Incentive Plan, filed as Exhibit 99.1 to the Company’s Form 8-K filed on May 12, 2011 (Commission File No. 1-4797) and incorporated herein by reference.
10(gg)	Letter Agreement, dated January 12, 2012, among the Company, Relational Investors LLC and the other parties named in the Letter Agreement, filed as Exhibit 99.1 to the Company's Current Report on Form 8-K filed on January 13, 2012 (Commission File No. 1-4797) and incorporated herein by reference.
21	Subsidiaries and Affiliates of the Company.
23	Consent of Independent Registered Public Accounting Firm.
24	Powers of Attorney.
31	Rule 13a-14(a) Certifications.
32	Section 1350 Certification.
99(a)	Description of the capital stock of Illinois Tool Works Inc. filed as Exhibit 99(a) to the Company’s Annual Report on Form 10-K filed on February 26, 2010 (Commission File No. 1-4797) and incorporated herein by reference.
101.INS	XBRL Instance Document**
101.SCH	XBRL Taxonomy Extension Schema**
101.CAL	XBRL Taxonomy Extension Calculation Linkbase**
101.DEF	XBRL Taxonomy Extension Definition Linkbase**
101.LAB	XBRL Taxonomy Extension Label Linkbase**
101.PRE	XBRL Taxonomy Extension Presentation Linkbase**

* Management contract or compensatory plan or arrangement.

** The following financial information from Illinois Tool Works Inc. Company's Annual Report on Form 10-K for the year ended December 31, 2012, formatted in XBRL (Extensible Business Reporting Language): (i) Statement of Income, (ii) Statement of Comprehensive Income, (iii) Statement of Income Reinvested in the Business (iv) Statement of Financial Position, (v) Statement of Cash Flows and (vi) related Notes to Financial Statements.

78

EX-21

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

145ES (CANADA) Limited	Nova Scotia
A V Co 1 Limited	United Kingdom
A V Co 2 Limited	United Kingdom
A V Co 3 Limited	United Kingdom
A.C.N. 000 043 872 Pty Limited	Australia
A.C.N. 000 370 150 Pty Ltd	Australia
A.C.N. 004 089 847 Pty Ltd	Australia
A.C.N. 004 297 009 Pty Ltd	Australia
A.C.N. 004 502 112 Pty Ltd.	Australia
A.C.N. 004 547 111 Pty Limited	Australia
A.C.N. 094 567 763 Pty Limited	Australia
AB Sjötofta Tråddrageri	Sweden
Accessories Marketing Holding Corp.	Germany
Accessories Marketing, Inc.	California
ACCULUBE Manufacturing GmbH- Schmiermittel und-gerate	Germany
Advanced Molding Company, Inc.	Philippines
AEC Technology SRL	Italy
AIP/BI Holdings, Inc.	Delaware
Allen Coding GmbH	Germany
Allen France SAS	France
Alpine Automation Limited	United Kingdom
Alpine Holdings, Inc.	Delaware
Alpine Systems Corporation	Ontario
Anaerobicos do Brasil Adesivos Ltda.	Brazil
Anaerobicos Srl	Argentina
Anahol SA	Argentina
Appleton Investments II L.L.C.	Delaware
Appleton Investments L.L.C.	Delaware
AppliChem GmbH	Germany
Applichem UK Limited	United Kingdom
Applichem, Inc.	Connecticut
Applied Australia Pty. Ltd.	Australia
Archem Quimica Ltda	Brazil
Ark-Les Components S.A. de C.V.	Mexico
Arylux Hungary Elektromechanikus Alkatreszgyarto Kft	Hungary
Auralex du Mont de Magny SCI	France
Avery Berkel France SAS	France
Avery India Limited	India
Avery Malaysia Sdn Bhd	Malaysia
Avery Weigh-Tronix (Suzhou) Weighing Technology Co. Ltd.	China
Avery Weigh-Tronix B.V.	Netherlands
Avery Weigh-Tronix Finance Limited	United Kingdom
Avery Weigh-Tronix Holdings Limited	United Kingdom
Avery Weigh-Tronix International Limited	United Kingdom
Avery Weigh-Tronix Limited	United Kingdom
Avery Weigh-Tronix Private Limited	India
Avery Weigh-Tronix Properties Limited	United Kingdom
Avery Weigh-Tronix UK Limited	United Kingdom
Avery Weigh-Tronix, LLC	Delaware
AWT Scales Limited	United Kingdom
AXA Power ApS	Denmark

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

B.C. Immo S.C.I.	France
Bangalore Integrated System Solutions Private Ltd	India
Bates Cargo-Pak ApS	Denmark
Bayshore Truck Equipment Company	Delaware
Beijing Miller Electric Manufacturing Co. Ltd.	China
Berkel (Ireland) Limited	Ireland
Berrington UK	United Kingdom
Betterway Ventures Ltd.	British Virgin Islands
Binks	United Kingdom
Bonnet Benelux Bvba	Belgium
Brapenta Eletronica Ltda.	Brazil
Bravoll Deutschland GmbH	Germany
Bravoll spol. s.r.o.	Czech Republic
Brook Instrument Korea Ltd.	Korea
Brooks Instrument (Hong Kong) Limited	Hong Kong
Brooks Instrument (Shanghai) Co. Ltd.	China
Brooks Instrument Asia Holdco	Mauritius
Brooks Instrument B.V.	Netherlands
Brooks Instrument Canada Corp.	Canada
Brooks Instrument Europe Operations B.V.	Netherlands
Brooks Instrument GmbH	Germany
Brooks Instrument India Private Limited	India
Brooks Instrument Kabushiki Kaisha	Japan
Brooks Instrument KFT	Hungary
Brooks Instrument Korea, Ltd.	Korea
Brooks Instrument LLC	Delaware
Brooks Instrument SAS	France
Brooks Instrument Singapore Pte, Ltd.	Singapore
Buell Industries, Inc.	Delaware
Burseryds Bruk AB	Sweden
Bycotest AB	Sweden
Calvia sp. Z.o.o.	Poland
Capital Ventures (Australasia) S.à r.l	Luxembourg
Caretex ApS	Denmark
Caretex Asia Ltd.	Thailand
Caretex PTE Ltd.	Singapore
Caretex ROH (Thailand) Ltd.	Thailand
Caretex USA Inc.	Delaware
CCC Heavy Duty Truck Parts Company	Delaware
CCC Parts Company	Delaware
CCC Truck Parts Company	Delaware
CCI Corporation	Delaware
CCI Realty Company	Delaware
Ceast Asia Pte Ltd.	Singapore
Celcor Limited	Ontario
Celeste Industries Corporation	Connecticut
Central Weighing Limited	United Kingdom
CER Foils SAS	France
CER SAS	France
Cetram Pty Limited	Australia
CFC Europe (UK) Limited	United Kingdom

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

CFC Europe GmbH	Germany
CFC International Corporation	Delaware
Cheer Bright Ltd.	British Virgin Islands
Chris Kay Limited	Ireland
Cleanman Cleaning Devices Ltd.	Taiwan
Coeur (Shanghai) Medical Appliance Trading Co., Ltd	China
Coeur Asia Limited	China
Coeur Europe	Belgium
Coeur Holding Company	Delaware
Coeur Medical Products Services, S. De R.L. De C.V.	Mexico
Coeur Medical Products, LLC	Delaware
Coeur Medical Products, S. De R.L. De C.V.	Mexico
Coeur Medical Services, LLC	Delaware
Coeur, Inc.	Indiana
Comistelcom, S.L.	Spain
Compagnie de Materiel et d'Equipements Techniques-Comet SAS	France
Compagnie Hobart S.A.S.	France
Constructions Isothermiques Bontami SAS	France
Crane Carrier (Canada) Limited	Canada
Crane Carrier Company	Delaware
CS (Australasia) Limited	Bermuda
CS (Australia) Pty Limited	Australia
CS (Europe) Holdings Ltd.	Bermuda
CS (Far East) Holding Company Ltd.	Bermuda
CS (Finance) Europe S.a.r.l.	Luxembourg
CS (Global) Holdings Ltd.	Bermuda
CS (Investments) Ltd.	Bermuda
CS (Ventures) Ltd.	Bermuda
CS Domestic Financing Inc.	United States
CS Financing I LLC	Delaware
CS Investments Australia Pty Ltd	Australia
CS Mexico Holding Company S DE RL DE CV	Mexico
CS Packaging Corporation Ltd.	British Virgin Islands
CS PMI Holdings Inc.	Delaware
CSMTS INC.	Delaware
CSTS L.L.C.	Delaware
Cullen Building Products Inc.	Canada
Cumberland Leasing Co.	Illinois
D.F. International (Dominican Republic) Inc.	Delaware
Dacro B.V.	Netherlands
Danley Construction Products Pty Ltd	Australia
DBM.S Deutsche Baumärkte Service GmbH	Germany
D-Clean profi, s.r.o.	Czech Republic
Densit ApS	Denmark
Densit Asia Pacific Sdn Bhd	Malaysia
Despatch Industries (Shanghai) Trading Co., Ltd	China
Despatch Industries GmbH	Germany
Despatch Industries Korea Yuhan Hoesa	Korea-South
Despatch Industries Limited Partnership	Minnesota
Despatch Industries PTE Ltd.	Singapore
Despatch Industries Taiwan Ltd.	Taiwan

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

Devcon Limited	Ireland
DGFC Inc.	Delaware
DHP (Thailand) Limited	Thailand
DHP Co., Ltd.	South Korea
Diagraph Corporation Sdn. Bhd	Malaysia
Diagraph ITW Mexico, S. de R.L. De C.V.	Mexico
Diagraph México, S.A. DE C.V.	Mexico
Distribuidora de Productos Sebring, S. de R.L. de C.V.	Mexico
Dongguan Ark-Les Electric Components Co., Ltd.	China
Dongguan CK Branding Co., Ltd.	China
Dorbyl U.K. (Holdings) Limited	United Kingdom
Duo-Fast Corporation	Illinois
Duo-Fast de Espana S.A.	Spain
Duo-Fast Korea Co. Ltd.	South Korea
E.C.S. d.o.o.	Croatia
ECS Cable Protection Sp. Zoo	Poland
Eddie Connally & Co Limited	Ireland
Elastomeric Roofing Systems, Inc.	Minnesota
Electric Light Development Ltd.	British Virgin Islands
Elga AB	Sweden
Elga Skandinavian AS	Norway
Elisphere Sarl	France
ELRO (Holding) AG	Switzerland
ELRO (U.K.) LIMITED	United Kingdom
ELRO Grosskuchen GmbH	Austria
ELRO Grosskuchen Gmbh	Germany
ELRO Gulf FZE	United Arab Emirates
ELRO-WERKE AG	Switzerland
Eltex-Elektrostatik-Gesellschaft mit beschränkter Haftung	Germany
EMIC Equipamentos E Sistemas De Ensaio Ltda.	Brazil
Envases Multipac, S.A. de C.V.	Mexico
EP Holdings General Partnership	Australia
Epirez Australia Pty Ltd	Australia
Equipamentos Cientificos Instron Ltda.	Brazil
Euromere Spraycore SAS	France
Eurotec Deutschland GmbH	Germany
Eurotec Srl	Italy
Exactrak Limited	United Kingdom
Exportadora Lerma SA	Mexico
Facido GmbH	Germany
Fantapak International Corporation	Michigan
Fargesta Participacoes Ltda.	Brazil
Fasver SAS	France
Fasver Technology, Inc.	Delaware
FEG Investments L.L.C.	Delaware
Filtertek De Mexico Holding Inc.	Delaware
Filtertek De Mexico, S.A. de C.V.	Mexico
Filtertek Do Brasil Industria E Comercio Ltda.	Brazil
Filtertek S.A.S.	France
Flejes MISA, S. de R.L. de C.V.	Mexico
Flejes Modelo, S. DE R.L. DE C.V.	Mexico

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

Forkardt - France SAS	France
Forkardt Deutschland GmbH	Germany
Forkardt International Limited	United Kingdom
Forkardt Schweiz GmbH	Switzerland
Form Koruyucu Ambalaj Sanayi Ve Ticaret Limited Sirketi	Turkey
Forte Noord-West-Europa B.V.	Netherlands
Foster Refrigerator France S.A.S.	France
Gamko B.V.	Netherlands
Gamko Réfrigération Eurl	France
Gamko Slovakia S.R.O.	Slovakia
Gamko Vyroba S.R.O.	Slovakia
GC Financement SA	France
GK Despatch Industries	Japan
GloboPlastt s.r.o.	Slovakia
GRK Canada Limited	Canada
GRK US Limited	Minnesota
GSE Holdings Inc.	Delaware
GSE IP LLC	Delaware
Guangzhou Hwa Meir Packing Daily Commodities Co., Ltd.	China
Gun Hwa Platech (Taicang) Co. Ltd.	China
H.A. Springer marine + Industrie service GmbH	Germany
Hartness Aviation, LLC	South Carolina
Hartness International Europe, GmbH	Germany
Haubold Paslode GmbH (Switzerland)	Switzerland
Haubold-Kihlberg bvba	Belgium
Heavy Duty Parts, Inc.	Delaware
Heger Belgium BVBA	Belgium
Heger GmbH European Diamond Tools	Germany
Heger Holland B.V	Netherlands
High Mind International Offshore Limited	British Virgin Islands
Highland Champ Corporation	British Virgin Islands
Hobart (Japan) K.K.	Japan
Hobart Andina S.A.	Columbia
Hobart Argentina S.A.	Argentina
Hobart Brothers Company	Ohio
Hobart Brothers International Chile Limitada	Chile
Hobart Canada Corp.	Canada
Hobart Corporation	Delaware
Hobart Dayton Mexicana, S. de R.L. de C.V.	Mexico
Hobart do Brasil Ltd.	Brazil
Hobart Food Equipment Co., Ltd.	China
Hobart Foster Belgium B.V.B.A.	Belgium
HOBART Gesellschaft mit beschränkter Haftung	Germany
Hobart International (Singapore) Pte. Ltd.	Singapore
Hobart Korea Co. Ltd.	South Korea
Hobart Nederland B.V.	Netherlands
Hobart Sales & Service, Inc.	Ohio
Hobart Scandinavia ApS	Denmark
Hobart Techniek B.V.	Netherlands
Hopital Services Systemes S.A.S.	France
Horis SAS	France

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

Hsb SOFT Limited	Ireland
HsbSOFT Cia Ltda	Ecuador
HsbSOFT, BVBA	Belgium
I.T.W. Inc.	Illinois
ILC Investments Holdings Inc.	United States
Illinois Tool Works (Chile) Limitada	Chile
Illinois Tool Works (ITW) Nederland B.V.	Netherlands
Illinois Tool Works Norway AS	Norway
Impar Comercio Representacoes Ltd.	Brazil
Indiana Pickling and Processing Company	Indiana
Industria e Comercio de Maquinas Perfecta Curitiba Ltda.	Brazil
Industrias Concepto del Pacifico Guatemala S.A.	Guatemala
Industrie Plastic Elsässer GmbH	Germany
InHold (NZ) Finance Ltd.	Bermuda
InHold (UK) Finance Ltd.	Bermuda
Inmobillaria Cit., S.A. de C.F.	Mexico
INN SP Z.o.o.	Poland
Innova Temperlite 1200, S.A. de C.V.	Mexico
Innova Temperlite Servicios, S.A. de C.V.	Mexico
Instron (Shanghai) Experiment Equipment Trade Co., Ltd.	China
Instron (Thailand) Limited	Thailand
Instron Deutschland GmbH	Germany
Instron Foreign Sales Corp. Limited	Jamaica
Instron France S.A.S.	France
Instron Holdings Limited	United Kingdom
Instron India Private Limited	India
Instron International Limited	United Kingdom
Instron Japan Company, Ltd.	Massachusetts
Instron Korea LLC	South Korea
Instron Proprietary Limited	Australia
Instron Singapore Pte Limited	Singapore
Instron Structural Testing Systems GmbH	Germany
International Leasing Company	Delaware
International Truss Systems Proprietary Limited	South Africa
Interstrap B.V.	Netherlands
IPHC LLC	Delaware
Isolenge Isolantes Termicos Ltda	Brazil
Isolenge Termo Construcoes Ltda.	Brazil
ITECMA S.A.S.	France
ITW (China) Investment Company Limited	China
ITW (Deutschland) GmbH	Germany
ITW (EU) Holdings Ltd.	Bermuda
ITW (Malaysian) Holdings Company Ltd.	Bermuda
ITW Acmor (Shanghai) Co., Ltd.	China
ITW Administration GmbH	Germany
ITW AEP LLC	Delaware
ITW AFC Pty Ltd	Australia
ITW Air Hammer s.r.o.	Czech Republic
ITW Aircraft Investments Inc.	Delaware
ITW Airport Ground Equipment (Beijing) Co. Ltd.	China
ITW Alpha Sárl	Luxembourg

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

ITW Ampang Industries Philippines, Inc.	Philippines
ITW Angleboard AB	Sweden
ITW AOC, LLC	South Korea
ITW Ark-Les Corporation	Massachusetts
ITW Australia Pty Ltd	Australia
ITW Austria Vertriebs GmbH	Austria
ITW Automotive Components & Fasteners Japan K.K.	Japan
ITW Automotive Components (Chongqing) Co. Ltd.	China
ITW Automotive Fasteners (Shanghai) Co., Ltd.	China
ITW Automotive Italia Srl	Italy
ITW Automotive Products GmbH	Germany
ITW Bailly Comte S.A.S.	France
ITW Bay Area Labels (Shanghai) Co., Ltd.	China
ITW Befestigungssysteme GmbH	Germany
ITW Belgium S.p.r.l.	Belgium
ITW Bevestigingssystemen B.V.	Netherlands
ITW Brazilian Nominee L.L.C.	Delaware
ITW Building Components Group Inc.	Delaware
ITW Bulgaria EOOD	Bulgaria
ITW Business Development S.à r.l.	Luxembourg
ITW Canada Holdings Company	Nova Scotia
ITW Canada Inc.	Ontario
ITW Canada Investments Limited Partnership	Canada
ITW Canada Management Company/Compagnie Gestion ITW Canada	Nova Scotia
ITW CCIP Holdings LLC	Delaware
ITW Celeste Inc.	Delaware
ITW Chemical Products Ltda	Brazil
ITW Chemical Products Scandinavia ApS	Denmark
ITW Colombia S.A.S.	Colombia
ITW Construction Products (Singapore) Pte. Ltd.	Singapore
ITW Construction Products (Suzhou) Co. Ltd.	China
ITW Construction Products AB	Sweden
ITW Construction Products ApS	Denmark
ITW Construction Products AS	Norway
ITW Construction Products CR, s.r.o.	Czech Republic
ITW Construction Products Espana S.A.	Spain
ITW Construction Products Italy Srl	Italy
ITW Construction Products Malaysia Sdn. Bhd.	Malaysia
ITW Construction Products OU	Estonia
ITW Construction Products Oy	Finland
ITW Contamination Control (Wujiang) Company Limited	China
ITW Contamination Control B.V.	Netherlands
ITW Covid Security Group Inc.	Delaware
ITW CP Distribution Center Holland BV	Netherlands
ITW CPM S.A.S.	France
ITW CS (UK) Ltd.	United Kingdom
ITW DaeLim, LLC	South Korea
ITW de France S.A.S.	France
ITW de Guatemala Y Compañia, Sociedad en Comandita por Acciones	Guatemala
ITW DelFast do Brasil Ltda.	Brazil
ITW Delta Sárl	Luxembourg

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

ITW Denmark ApS	Denmark
ITW do Brasil Industrial e Comercial Ltda.	Brazil
ITW Domestic Finance II Inc.	Delaware
ITW Domestic Holdings Inc.	Delaware
ITW DS Investments Inc.	Delaware
ITW Dynatec Adhesive Equipment (Suzhou) Co. Ltd.	China
ITW Dynatec GmbH	Germany
ITW Dynatec Kabushiki Kaisha	Japan
ITW Dynatec Singapore Pte. Ltd.	Singapore
ITW Electronic Business Asia Co., Limited	Taiwan
ITW Electronic Components/Products (Shanghai) Co., Ltd.	China
ITW Electronic Packaging (Malta) Ltd.	Malta
ITW Epsilon Sárl	Luxembourg
ITW Espana S.A.	Spain
ITW Fastener Products GmbH	Germany
ITW Fastex de Argentina S.A.	Argentina
ITW FEG Hong Kong Limited	Hong Kong
ITW Finance Europe SA	Luxembourg
ITW Finance II L.L.C.	Delaware
ITW Foils B.V.	Netherlands
ITW Foils, S.L.	Spain
ITW Food Equipment Group LLC	Delaware
ITW Gamma Sárl	Luxembourg
ITW German Management LLC	Delaware
ITW German Real Estate Management GmbH & Co. KG	Germany
ITW GH LLC	South Korea
ITW Global Investments Holdings LLC	Delaware
ITW Global Investments Inc.	Delaware
ITW Graphics (Thailand) Ltd.	Thailand
ITW Graphics Asia Limited	Hong Kong
ITW Graphics France Eurl	France
ITW Graphics Italy S.r.l.	Italy
ITW Graphics Korea Co. Ltd.	South Korea
ITW Graphics Tekstil Sanayi Ve Dis Ticaret Limited Sirketi	Turkey
ITW Great Britain Investment & Licensing Holding Company	Delaware
ITW Group European Finance Company Ltd.	Bermuda
ITW Group France (Luxembourg) S.à r.l.	Luxembourg
ITW GSE Group Asia Pacific (s) PTE LTD.	Singapore
ITW Guatemala Holdings LLC	Delaware
ITW Gunther S.A.S.	France
ITW Heller GmbH	Germany
ITW Hi-Cone Japan Limited	Japan
ITW HLP Thailand Co. Ltd.	Thailand
ITW Holding Quimica B.C., S.L., Sole Shareholder Company	Spain
ITW Holdings Australia L.P.	Australia
ITW Holdings Pty Ltd	Australia
ITW Holdings UK	United Kingdom
ITW ILC Holdings I Inc.	Delaware
ITW Imaden Industria e Comercio Ltda.	Brazil
ITW India Limited	India
ITW Industrial Components SrL	Italy

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

ITW Industry B.V.	Netherlands
ITW Industry SAS	France
ITW Insulation System - Sistemas de Isolamento Ltda.	Brazil
ITW Insulation Systems FZE	United Arab Emirates
ITW Insulation Systems Malaysia Sdn Bhd	Malaysia
ITW International Holdings LLC	Delaware
ITW International Intellectual Property LLC	Delaware
ITW Investments Limited	United Kingdom
ITW Ireland	Ireland
ITW Ireland Holdings	Ireland
ITW Ispracontrols Bulgaria EOOD	Bulgaria
ITW Italy Finance Srl	Italy
ITW Italy Holding Srl	Italy
ITW Limited	United Kingdom
ITW Litec France S.A.S.	France
ITW LLC & Co. KG	Germany
ITW Lombard Holdings Inc.	Delaware
ITW Meritex Sdn. Bhd.	Malaysia
ITW Metal Fasteners, S.L.	Spain
ITW Metalflex D.o.o.	Slovenia
ITW Mexico Capital, S. DE R.L. DE C.V.	Mexico
ITW Mexico Holding Company S. De R.L. de C.V.	Mexico
ITW Mexico Holding Inc.	Delaware
ITW Mexico Holdings LLC	Delaware
ITW México, S. de R.L. de C.V.	Mexico
ITW Mima Films L.L.C.	Delaware
ITW Mima Holdings L.L.C.	Delaware
ITW Mima Systems S.A.S.	France
ITW Morlock GmbH	Germany
ITW Mortgage Investments I, Inc.	Delaware
ITW Mortgage Investments II, Inc.	Delaware
ITW Mortgage Investments III, Inc.	Delaware
ITW Mortgage Investments IV, Inc.	Delaware
ITW New Zealand Holdings	New Zealand
ITW New Zealand Limited	New Zealand
ITW North America Canada, Inc	Canada
ITW Novadan Sp. Z.o.o.	Poland
ITW Operations Australia Pty Ltd	Australia
ITW Packaging (Malaysia) Sdn Bhd	Malaysia
ITW Packaging (Qingdao) Co. Ltd.	China
ITW Packaging (Shanghai) Co., Ltd.	China
ITW Packaging Systems Group GmbH	Germany
ITW Packaging Systems OOO	Russia
ITW Participacoes Ltda.	Brazil
ITW Participations S.à r.l.	Luxembourg
ITW Pension Funds Trustee Company	United Kingdom
ITW Performance Polymers & Fluids Japan Co. Ltd.	Japan
ITW Performance Polymers & Fluids Korea Limited	South Korea
ITW Performance Polymers & Fluids OOO	Russia
ITW Performance Polymers (Wujiang) Co., Ltd.	China
ITW Performance Polymers and Fluids (Hong Kong) Co. Limited	Hong Kong

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

ITW Performance Polymers and Fluids Group FZE	United Arab Emirates
ITW Performance Polymers and Fluids Pte. Ltd.	Singapore
ITW Performance Polymers Trading (Shanghai) Co. Ltd.	China
ITW Philippines Holdings LLC	Delaware
ITW PMI Investments, Inc.	Delaware
ITW POLSKA SP. Z O.O.	Poland
ITW Poly Recycling GmbH	Switzerland
ITW Polymex, S. DE R.L. DE C.V.	Mexico
ITW PPF Brasil Adesivos Ltda.	Brazil
ITW Pronovia s.r.o.	Czech Republic
ITW Real Estate Management GmbH	Germany
ITW Residuals III L.L.C.	Delaware
ITW Residuals IV L.L.C.	Delaware
ITW Reyflex France S.A.S.	France
ITW Rivex S.A.S.	France
ITW Servicios, S. de R.L. de C.V.	Mexico
ITW Shippers S.p.r.l.	Belgium
ITW Signode Holding GmbH	Germany
ITW Simco-Ion (Shenzhen) Co. Ltd.	China
ITW Singapore (Pte) Ltd.	Singapore
ITW SMPI S.A.S.	France
ITW Spain Holdings, S.L.	Spain
ITW Specialty Film LLC	South Korea
ITW Specialty Films (Poland) sp zoo	Poland
ITW Specialty Films France	France
ITW Specialty Films Italy S.r.l.	Italy
ITW Speedline Equipment (Suzhou) Co. Ltd.	China
ITW Spraytec S.A.S.	France
ITW Stokvis Conversao De Fitas Adesivas Ltda.	Brazil
ITW Strapping (Shenyang) Co., Ltd.	China
ITW Sverige AB	Sweden
ITW Sweden Holding AB	Sweden
ITW Syn-Tex México S.A de C.V.	Mexico
ITW Temb (QUFU) Automotive Cooling Systems Co. Ltd.	China
ITW Test & Measurement (Shanghai) Co., Ltd	China
ITW Test & Measurement GmbH	Germany
ITW Test and Measurement Italia Srl	Italy
ITW Test and Measurement Services Industry and Trade Ltd.	Turkey
ITW Texwipe Philippines, Inc.	Philippines
ITW Thermal Films (Shanghai) Co., Ltd.	China
ITW Tiede Non-destructive testing GmbH	Germany
ITW UK	United Kingdom
ITW Universal II LLC	Delaware
ITW Universal L.L.C.	Delaware
ITW V.A.C. B.V.	Netherlands
ITW Welding Products B.V.	Netherlands
ITW Welding Products Group FZE	UAE -Dubai
ITW Welding Products Group, S. DE R.L. De C.V.	Mexico
ITW Welding Products Italy Srl	Italy
ITW Welding Products Limited Liability Company	Russia
ITW Welding Produtos Para Solgdagem Ltda.	Brazil

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

ITW Welding S.A.S.	France
ITW Welding Servicios, S. de R.L. de C.V.	Mexico
ITW Welding Singapore Pte. Ltd.	Singapore
ITW Welding Torches Europe D-Tech GmbH	Germany
ITW Zip-Pak Packaging (Shanghai) Ltd.	China
James Briggs Holdings	United Kingdom
James Briggs Trustee Limited	United Kingdom
Japan Polymark Co. Ltd.	Japan
Josef Kihlberg AB	Sweden
Josef Kihlberg AS	Norway
Josef Kihlberg ZAO	Russian Federation
KB Sektionen 1	Sweden
KCPL Holdings Private Limited	Singapore
KCPL Mauritius Holdings	Mauritius
Kester Asia Holdings, Inc.	Delaware
Kester Components (M) Sdn. Bhd.	Malaysia
Kester Components Private Limited	Singapore
Kester Electronic Materials (Suzhou) Co., Ltd.	China
Kester GmbH	Germany
Kester, Inc.	Delaware
Kitazawa Sangyo Co., Ltd.	Japan
Kiwiplan Europe Limited	United Kingdom
Kiwiplan GmbH	Germany
Kiwiplan Inc.	Ohio
Kiwiplan NZ	New Zealand
Kleinmann GmbH	Germany
KP Comercio e Industria de Productos Para Automoveis e Lubrificantes, S.A.	Portugal
Krafft Argentina, S.A.	Argentina
Krafft, S.L.	Spain
Lachenmeier ApS	Denmark
Lajota SA	Argentina
Lebo, S.L.	Spain
Liljendals Bruk AB	Finland
Lock Inspection Group Limited	United Kingdom
Lock Inspection Holdings Limited	United Kingdom
Lock Inspection Investments Limited	United Kingdom
Lock Inspection Systemes France Sarl	France
Lock Inspection Systems BV	Netherlands
Lock Inspection Systems Inc.	Massachusetts
Lock Inspection Systems Limited	United Kingdom
Loma Systems (Canada) Inc.	Canada
Loma Systems sro	Czech Republic
Lombard Pressings Limited	United Kingdom
Loveshaw Europe Limited	United Kingdom
LSPS Inc.	Delaware
Lumex, Inc.	Illinois
Lunsar Participacões Ltda.	Brazil
Luvex Industria De Equipamentos De Protecao Ltda.	Brazil
Lys Fusion Poland Sp. z.o.o.	Poland
M & C Specialties (Ireland) Limited	Ireland
M & C Specialties Co.	Pennsylvania

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

M & C Specialties Company HK Limited	Hong Kong
M&C Specialties (Shenzhen) Co. Ltd.	China
M&C Specialties Bohai Converting M&C Co.	China
M.P.S. Metal Plastik Sanayi Cember ve Paketleme Sistemleri Imalat ve Ticaret A.S.	Turkey
Magna Industrial Company Limited	Hong Kong
Manhattan Lynch Limited	United Kingdom
Manufacturing Avancee S.A.	Morocco
Maquilas y Componentes Industriales, I S.A. de C.V.	Mexico
Marescol SA	France
Maxal International, Inc.	Michigan
Mbelish.com Limited	United Kingdom
MBM France S.A.S.	France
Mercotrade Importacao e Exportacao Ltda.	Brazil
Meritex Technology (Suzhou) Co. Ltd.	China
Metro Sport Limited	United Kingdom
Metropolitan Oils (Proprietary) Limited	South Africa
Mezger Heftsysteme GmbH	Germany
Miller Electric Mfg. Co.	Wisconsin
Miller Insurance Ltd.	Bermuda
Mima Films L.L.C.	Delaware
Mima Films S.a.r.l.	Luxembourg
Mima Films Sprl	Belgium
MultiBind Biotech GmbH	Germany
National Fleet Supply Corporation	Delaware
National Truck Parts of the Midwest, Inc.	Delaware
National Truck Parts, Inc.	Delaware
NDT Holding LLC	Delaware
Norden Czech s.r.o.	Czech Republic
NorDen Holding Hadsund ApS	Denmark
Norden Olje AB	Sweden
NorDen Olje ApS	Denmark
Norden Olje AS	Norway
Norden Sp. Z.o.o. Polen	Poland
Nordic S.A.S.	France
Norsk Signode AS	Norway
North Star Imaging Europe SAS	France
North Star Imaging, Inc.	Minnesota
Nova Chimica, S.r.l.	Italy
Novadan ApS	Denmark
Noza Holdings Pty Ltd	Australia
NSC Europe Limited	United Kingdom
NuTrus LLC	Delaware
NYCO-KRAFFT, S.A.	Spain
Odesign, Inc.	Illinois
Orbitalum Tools GmbH	Germany
Orgapack GmbH	Switzerland
Oy M. Haloila AB	Finland
P.W.T. Srl	Italy
Pacific Concept Industries (USA) LLC	Delaware
Pacific Concept Industries Limited (Enping)	China

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

Packaging Leasing Systems Inc.	Delaware
Packaging Solutions Tanzania Limited	Tanzania
Panreac Chimie, Sarl	France
Panreac Quimica, LDA	Portugal
Panreac Quimica, S.L.	Spain
Paradym Investments Ltd.	Nevada
Paslode Fasteners (Shanghai) Co., Ltd.	China
Paul Forkardt Inc.	Delaware
PCI (Shanghai) Trade Co. Ltd.	China
Penta Don OOO	Russia
Penta Enisey OOO	Russia
Penta Sever OOO	Russia
Penta Sibir OOO	Russia
Penta Ural OOO	Russia
Penta Volga OOO	Russia
PENTA-91 OOO	Russia
Periclimeno, S.L.	Spain
Pistora Oy	Finland
PMI Food Equipment Group Canada Inc.	Ontario
Polymark Export Limited	United Kingdom
PR. A. I. Srl	Italy
Precision Brake & Clutch, Inc.	Delaware
Premark FEG L.L.C.	Delaware
Premark HII Holdings, Inc.	Ohio
Premark International Holdings B.V.	Netherlands
Premark International, LLC	Delaware
Premark N.V.	Netherland Curacao
Prodex Selbstklebeprodukte GmbH	Germany
Prolex, Sociedad Anónima	Costa Rica
Prolim Comercio de Higiene E Limpeza Ltda.	Brazil
Prolim Quimica Avancada Ltda.	Brazil
Prolim Servicos e Manutencao Ltda.	Brazil
Propaper Industria E Comercio de Papeis Ltda.	Brazil
Pryda (Malaysia) Sdn Bhd	Malaysia
Pryda (Thailand) Co., Ltd.	Thailand
PT ITW Construction Products Indonesia	Indonesia
PT Pryda Indonesia	Indonesia
PTO Sales Corporation	Delaware
QSA Global, Inc.	Delaware
Quandel Verpackungs- und Foerdertechnik GmbH	Germany
Quimica Industrial Mediterraneo, S.L.	Spain
Quimica TF, S.A. de C.V.	Mexico
Ramset Fasteners (Hong Kong) Ltd.	Hong Kong
Ransburg-Gema UK Limited	United Kingdom
Rapid Cook LLC	Delaware
Regent Hose and Hydraulics Limited	United Kingdom
Rotular Servicoes e Assistencia Tecnica em Rotulagem Ltda.	Brazil
S.E.E. Sistemas Industria E Comercio Ltda.	Brazil
Saint John (Delaware) LLC	Delaware
Salter India Private Limited	India
Sarsfield Corporation N.V.	Netherland Curacao

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

Schember Ges.mbH	Austria
Schnee-Morehead, Inc.	Texas
Schneider + Klein Wyrobi Metalowe Sp.Zo.O.	Poland
Scybele S.A.S.	France
Sealant Systems International, Inc.	California
Sentinel Asia Yuhan Hoesa	South Korea
ServUS Fleet Management Inc.	Delaware
SG Invest Holding GmbH	Germany
Shanghai ITW Plastics And Metal Co., Ltd.	China
Signode (Thailand) Limited	Thailand
Signode AB	Sweden
Signode Brasileira Ltda.	Brazil
Signode Brazilian Nominee LLC	Delaware
Signode BVBA	Belgium
Signode Hong Kong Limited	Hong Kong
Signode Kabushiki Kaisha	Japan
Signode Korea Inc.	South Korea
Signode México, S. de R.L. de C.V.	Mexico
Signode Packaging Systems Limited	Kenya
Signode Pickling Holding LLC	Delaware
Signode Singapore Investments Pte. Ltd.	Singapore
Signode Singapore Pte. Ltd.	Singapore
Signode System GmbH	Germany
Simco (Nederland) B.V.	Netherlands
Simco Japan, Inc.	Japan
Six States Distributors, Inc.	Utah
Slab Holdings Limited	United Kingdom
Slime South Pacific Pty Ltd	Australia
Sn Investors, Inc.	Delaware
Sociedad Industrial Tecnica Colombiana S.A. (Sinteco)	Colombia
Société Civile Immobilière des Baquets	France
Societe Civile Immobiliere Rousseau-Ivry	France
Societe de Constructions Elbeuvienne de Materiels our L'Alimentation SAS	France
Société de Prospection et d'Inventions Techniques S.A.S.- SPIT	France
Solutions Group Transaction Subsidiary Inc.	Delaware
Space Bag LLC	Delaware
Speedline Holdings I, Inc.	Delaware
Speedline Holdings I, LLC	Delaware
Speedline Technologies Asia Pte. Ltd.	Singapore
Speedline Technologies GmbH	Germany
Speedline Technologies Mexico Services, S. de R.L. de C.V.	Mexico
Speedline Technologies Mexico, S. de R.L. de C.V.	Mexico
Speedline Technologies, Inc.	Delaware
Standard Parts Corporation	Delaware
Steelfast Asia Sdn Bhd	Malaysia
Stokvis Celix Espana Unipersonal SL	Spain
Stokvis Celix Portugal LDA	Spain
Stokvis Danmark AS	Denmark
Stokvis Promi Czech s.r.o.	Czech Republic
Stokvis Promi Slovakia s.r.o.	Slovakia
Stokvis Prostick Pvt. Ltd.	India

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

Stokvis Spain Holding SL	Spain
Stokvis Tape Group B.V.	Netherlands
Stokvis Tapes (Beijing) Co. Ltd.	China
Stokvis Tapes (Hong Kong) Co. Ltd.	Hong Kong
Stokvis Tapes (Shanghai) Co. Ltd.	China
Stokvis Tapes (Shenzhen) Co. Ltd.	China
Stokvis Tapes (Taiwan) Co. Ltd.	Taiwan
Stokvis Tapes (Tianjin) Co. Ltd.	China
Stokvis Tapes BVBA	Belgium
Stokvis Tapes Deutschland GmbH	Germany
Stokvis Tapes Deutschland Holding GmbH	Germany
Stokvis Tapes Estonia OÜ	Estonia
Stokvis Tapes France SAS	France
Stokvis Tapes India Pvt. Ltd.	India
Stokvis Tapes Limited Liability Company	Russia
Stokvis Tapes Magyarorszag Kft	Hungary
Stokvis Tapes Nederland B.V.	Netherlands
Stokvis Tapes Norge AS	Norway
Stokvis Tapes Oy	Finland
Stokvis Tapes Polska Sp Z.O.O.	Poland
Stokvis Tapes Singapore Pte. Ltd.	Singapore
Stokvis Tapes Sverige AB	Sweden
Strapex ApS	Denmark
Strapex Austria Ges. mbH	Austria
Strapex Embalagem L.d.a.	Portugal
Strapex GmbH	Germany
Strapex GmbH	Switzerland
Strapex Holding GmbH	Switzerland
Strapex Holdings Limited	United Kingdom
Strapex India Limited	India
Strapex Nederland B.V.	Netherlands
Strapex S.A.S.	France
Strapex S.p.r.l.	Belgium
Strapex Srl	Italy
Stretch Packaging Systems Company	Nova Scotia
Stretch Packaging Systems Limited	Ireland
Stretch Packaging Systems LLC	Delaware
Suki International GesmbH	Austria
Suki International GmbH	Germany
Suki International Trading (Shanghai) Co. Ltd.	China
Superior Spring Company	Delaware
Sweldx AB	Sweden
SWT Holdings B.V.	Netherlands
SysPack do Brasil Participações Ltda.	Brazil
Syspack Industria e Comercio de Sistemas de Embalagens Industriais Ltda.	Brazil
Tag Fasteners Sdn. Bhd.	Malaysia
Tarutin Kester Co., Ltd.	Japan
Technopack Industria, Comercio, Consultoria e Representacoes Ltda.	Brazil
Tecnotapes S.r.l.	Italy
Teknek (China) Limited	Scotland
Teknek (Japan) Limited	Scotland

Exhibit 21
Illinois Tool Works Inc.
Subsidiaries
Subsidiary Name	Primary Jurisdiction

Teknek Limited	Scotland
Teksaleco Ltd.	Scotland
Ten Plus S.A.S.	France
TERRA-S Automotive Systems GmbH & Co. KG	Germany
TERRA-S Japan KK	Japan
TERRA-S Michael Stehle Verwaltungs GmbH	Germany
The Devilbiss Company Limited	United Kingdom
The Loveshaw Corporation	Delaware
The Real Reel Corporation	Rhode Island
The Three Russells, Sociedad Anónima	Costa Rica
Thirode Grandes Cuisines Poligny SAS	France
Tien Tai Electrode (Kunshan) Co., Ltd.	China
Tien Tai Electrode (Qingdao) Co., Ltd.	China
Tien Tai Electrode Co., Ltd.	Taiwan
Tranosliw 2 Ltd.	United Kingdom
Troy Investments I LLC	Delaware
Truswal Systems Limited	United Kingdom
Twinaplate Limited	United Kingdom
U-Joints, Inc.	Delaware
Valeron Strength Films B.V.B.A.	Belgium
Varybond Chemie AG	Switzerland
Veneta Decalcogomme s.r.l.	Italy
Versachem Chile S.A.	Chile
Vertique, Inc.	North Carolina
Vitronics Soltec B.V.	Netherlands
Vitronics Soltec Corporation	Delaware
Vitronics Soltec Pte. Ltd.	Singapore
Vitronics Soltec Technologies (Suzhou) Co., Ltd.	China
VR-Leasing Sarita GmbH & Co. Immobilien KG	Germany
VS Acquisition Holding Co.	Delaware
VS European Holdco BV	Netherlands
VS Holding Co.	Delaware
Vulcan-Hart Canada Corp.	Canada
W & T Avery (Malawi) Limited	Malawi
Wachs Canada Ltd.	Nova Scotia
Wachs Subsea LLC	Illinois
Weigh-Tronix Canada, ULC	Nova Scotia
Weigh-Tronix UK Limited	United Kingdom
Wilsonart Finance Ltd.	Delaware
Wilsonart International Holdings LLC	Delaware
Wilsonart International, Inc.	Delaware
Wynn Oil (South Africa) (Pty) Ltd.	South Africa
Wynn's Automotive France SAS	France
Wynn's Belgium BVBA	Belgium
Wynn's Italia Srl	Italy
Wynn's Mekuba India Pvt Ltd	India
Wynn's Oil Holdings B.V.	Netherlands
Zip-Pak International B.V.	Netherlands
Zip-Pak Japan Company Limited	Japan

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in the previously filed Registration Statements on Form S-8 (File Nos. 333-105731, 333-108088, 333-69542, 333-142627, and 333-145392), Form S-3 (File No. 333-183449), and Form S-4 (File No. 333-163547) of our report dated February 19, 2013, relating to the consolidated financial statements of Illinois Tool Works Inc. and Subsidiaries, and the effectiveness of Illinois Tool Works Inc.'s internal control over financial reporting, appearing in this Annual Report on Form 10-K of Illinois Tool Works Inc. for the year ended December 31, 2012.

/s/ Deloitte & Touche LLP

Chicago, ILFebruary 19, 2013

EX-24

Exhibit 24

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ Daniel J. Brutto

Daniel J. Brutto

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ Susan Crown

Susan Crown

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ Don H. Davis, Jr.

Don H. Davis, Jr.

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ James W. Griffith

James W. Griffith

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ Robert C. McCormack

Robert C. McCormack

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ Robert S. Morrison

Robert S. Morrison

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ James A. Skinner

James A. Skinner

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ David B. Smith, Jr.

David B. Smith, Jr.

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ Pamela B. Strobel

Pamela B. Strobel

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ Kevin M. Warren

Kevin M. Warren

ILLINOIS TOOL WORKS INC.

Form 10-K Annual Report

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that the undersigned whose signature appears below constitutes and appoints E. Scott Santi, Ronald D. Kropp and Maria C. Green, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for her or him and in his or her name, place and stead, in any and all capacities, to sign the Company's Form 10-K Annual Report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

IN WITNESS WHEREOF, the undersigned has executed this power of attorney this 15th day of February, 2013.

/s/ Anré D. Williams

Anré D. Williams

EX-31

Exhibit 31

Rule 13a-14(a) Certification

I, E. Scott Santi, certify that:

1 I have reviewed this report on Form 10-K of Illinois Tool Works Inc.;

2 Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3 Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4 The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5 The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: February 19, 2013	/s/ E. Scott Santi
	E. Scott Santi
	President & Chief Executive Officer

Exhibit 31

Rule 13a-14(a) Certification

I, Ronald D. Kropp, certify that:

1. I have reviewed this report on Form 10-K of Illinois Tool Works Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: February 19, 2013	/s/ Ronald D. Kropp
	Ronald D. Kropp
	Senior Vice President & Chief Financial Officer

EX-32

Exhibit 32

Section 1350 Certification

The following statement is being made to the Securities and Exchange Commission solely for purposes of Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), which carries with it certain criminal penalties in the event of a knowing or willful misrepresentation.

Each of the undersigned hereby certifies that the Annual Report on Form 10-K for the period ended December 31, 2012 fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of the registrant.

Dated: February 19, 2013	/s/ E. Scott Santi
	E. Scott Santi
	President & Chief Executive Officer

Dated: February 19, 2013	/s/ Ronald D. Kropp
	Ronald D. Kropp
	Senior Vice President & Chief Financial Officer

XML

International Reporting Lag (Tables)

12 Months Ended

Dec. 31, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Impact of elimination of one month reporting lag for international operations

The impact of the elimination of the one-month reporting lag for international operations outside of North America for the year ended December 31, 2010 was as follows:

	Increase (Decrease)
In millions except per share amounts	2010
Operating revenues	$	(22	)
Income from continuing operations	(25		)
Income from continuing operations per diluted share	(0.04		)
Net income	(24		)
Net income per diluted share	(0.04		)

XML

Short-Term Debt (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Short-term Debt
Commercial paper	$ 408	$ 192
Bank overdrafts	40	38
Current maturities of long-term debt	6	262
Other borrowings	5	10
Total	$ 459	$ 502

XML

Pension and Other Postretirement Benefits (Tables)

12 Months Ended

Dec. 31, 2012

Compensation and Retirement Disclosure [Abstract]

Pension and other postretirement benefit costs

Summarized information regarding the Company’s significant defined benefit pension and other postretirement benefit plans related to both continuing and discontinued operations is as follows:

	Pension									Other Postretirement Benefits
In millions	2012			2011			2010			2012			2011			2010
Components of net periodic benefit cost:
Service cost	$	100		$	94		$	94		$	13		$	14		$	14
Interest cost	107			116			110			27			30			30
Expected return on plan assets	(157		)	(157		)	(150		)	(20		)	(21		)	(18		)
Amortization of actuarial loss	57			39			26			1			—			—
Amortization of prior service cost	1			1			1			3			6			6
Settlement/curtailment loss	14			—			1			—			—			—
	$	122		$	93		$	82		$	24		$	29		$	32

Net periodic benefit cost was included in the statement of income as follows:

	Pension						Other Postretirement Benefits
In millions	2012		2011		2010		2012		2011		2010
Income from continuing operations	$	121	$	89	$	80	$	24	$	29	$	32
Income from discontinued operations	1		4		2		—		—		—
	$	122	$	93	$	82	$	24	$	29	$	32

Change in benefit obligation

The following tables provide a rollforward of the plan benefit obligations, plan assets and a reconciliation of funded status for the years ended December 31, 2012 and 2011:

	Pension						Other Postretirement Benefits
In millions	2012			2011			2012			2011
Change in benefit obligation:
Benefit obligation at January 1	$	2,465		$	2,301		$	569		$	559
Service cost	100			94			13			14
Interest cost	107			116			27			30
Plan participants’ contributions	6			8			15			15
Amendments	5			—			—			—
Actuarial loss	204			79			45			—
Acquisitions/divestitures	(74		)	16			—			—
Benefits paid	(196		)	(142		)	(45		)	(48		)
Medicare subsidy received	—			—			3			3
Liabilities from (to) other immaterial plans	—			2			—			(4		)
Settlement/curtailment loss (gain)	5			—			(38		)	—
Foreign currency translation	33			(9		)	—			—
Benefit obligation at December 31	$	2,655		$	2,465		$	589		$	569

Change in plan assets

Change in plan assets:
Fair value of plan assets at January 1	$	2,054		$	1,941		$	297		$	294
Actual return on plan assets	240			108			31			3
Company contributions	190			131			30			33
Plan participants’ contributions	6			8			15			15
Acquisitions/divestitures	(38		)	15			—			—
Benefits paid	(196		)	(142		)	(45		)	(48		)
Foreign currency translation	32			(7		)	—			—
Fair value of plan assets at December 31	$	2,288		$	2,054		$	328		$	297
Funded status	$	(367	)	$	(411	)	$	(261	)	$	(272	)
Other immaterial plans	(58		)	(63		)	(7		)	(7		)
Net liability at December 31	$	(425	)	$	(474	)	$	(268	)	$	(279	)
The amounts recognized in the statement of financial position as of December 31 consist of:
Other assets	$	57		$	41		$	—		$	—
Accrued expenses	(12		)	(21		)	(7		)	(7		)
Liabilities held for sale	—			(13		)	—			—
Other noncurrent liabilities	(470		)	(481		)	(261		)	(272		)
Net liability at end of year	$	(425	)	$	(474	)	$	(268	)	$	(279	)
The pre-tax amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss	$	892		$	848		$	10		$	15
Prior service cost	7			4			2			5
	$	899		$	852		$	12		$	20
Accumulated benefit obligation	$	2,358		$	2,193
Plans with accumulated benefit obligation in excess of plan assets as of December 31:
Projected benefit obligation	$	1,928		$	1,838
Accumulated benefit obligation	$	1,741		$	1,665
Fair value of plan assets	$	1,524		$	1,414

Weighted-average assumptions used in the valuations of pension and other postretirement benefits

	Pension						Other Postretirement Benefits
	2012		2011		2010		2012		2011		2010
Assumptions used to determine benefit obligations at December 31:
Discount rate	3.85	%	4.64	%	5.05	%	4.15	%	4.95	%	5.45	%
Rate of compensation increases	3.86	%	3.86	%	3.94	%	—	%	—	%	—	%
Assumptions used to determine net periodic benefit cost for years ended December 31:
Discount rate	4.64	%	5.05	%	5.57	%	4.95	%	5.45	%	5.80	%
Expected return on plan assets	7.23	%	7.39	%	7.63	%	7.00	%	7.00	%	7.00	%
Rate of compensation increases	3.86	%	3.94	%	4.18	%	—	%	—	%	—	%

Postretirement benefit obligation

Assumed health care cost trend rates have an effect on the amounts reported for the postretirement health care benefit plans. The assumed health care cost trend rates used to determine the postretirement benefit obligation at December 31 were as follows:

	2012		2011		2010
Health care cost trend rate assumed for the next year	7.35	%	8.50	%	8.71	%
Ultimate trend rate	5.00	%	5.00	%	5.00	%
Year the rate reaches the ultimate trend rate	2019		2019		2020

One-percentage-point change in assumed health care cost trend rates

A one percentage-point change in assumed health care cost trend rates would have the following impact:

In millions	1 Percentage-Point Increase		1 Percentage-Point Decrease
Change in service cost and interest cost for 2012	$	1	$	(1	)
Change in postretirement benefit obligation at December 31, 2012	$	13	$	(16	)

Defined benefit plan assets for plan benefits

The following tables present the fair value of the Company’s pension and other postretirement benefit plan assets at December 31, 2012 and 2011, by asset category and valuation methodology. Level 1 assets are valued using unadjusted quoted prices for identical assets in active markets. Level 2 assets are valued using quoted prices or other observable inputs for similar assets. Level 3 assets are valued using unobservable inputs, but reflect the assumptions market participants would be expected to use in pricing the assets. Each financial instrument’s categorization is based on the lowest level of input that is significant to the fair value measurement.

	2012
In millions	Level 1		Level 2		Level 3		Total
Pension Plan Assets:
Cash and equivalents	$	26	$	—	$	—	$	26
Equity securities:
Domestic	56		—		—		56
Foreign	85		—		—		85
Fixed income securities:
Government securities	—		245		—		245
Corporate debt securities	—		263		—		263
Mortgage-backed securities	—		12		—		12
Investment contracts with insurance companies	—		—		75		75
Commingled funds:
Mutual funds	387		—		—		387
Collective trust funds	—		1,055		—		1,055
Partnerships/private equity interests	—		—		84		84
	$	554	$	1,575	$	159	$	2,288
Other Postretirement Benefit Plan Assets:
Cash and equivalents	$	34	$	—	$	—	$	34
Life insurance policies	—		—		294		294
	$	34	$	—	$	294	$	328

	2011
In millions	Level 1		Level 2		Level 3		Total
Pension Plan Assets:
Cash and equivalents	$	17	$	—	$	—	$	17
Equity securities:
Domestic	56		—		—		56
Foreign	68		—		—		68
Fixed income securities:
Government securities	—		218		—		218
Corporate debt securities	—		240		4		244
Mortgage-backed securities	—		16		—		16
Investment contracts with insurance companies	—		—		69		69
Commingled funds:
Mutual funds	345		—		—		345
Collective trust funds	—		932		—		932
Partnerships/private equity interests	—		—		87		87
Other	—		1		1		2
	$	486	$	1,407	$	161	$	2,054
Other Postretirement Benefit Plan Assets:
Cash and equivalents	$	34	$	—	$	—	$	34
Life insurance policies	—		—		263		263
	$	34	$	—	$	263	$	297

Assets measured at fair value for pension and other postretirement benefit plan

The following table presents a reconciliation of Level 3 assets measured at fair value for pension and other postretirement benefit plans during the years ended December 31, 2012 and 2011:

In millions	Government Securities			Corporate Debt Securities			Investment Contracts with Insurance Companies		Partnerships/ Private  Equity Interests			Life Insurance Policies			Other			Total
Balance Dec 31, 2010	$	1		$	3		$	—	$	78		$	265		$	—		$	347
2011 Activity:
Realized gains (losses)	—			—			—		4			—			—			4
Unrealized gains (losses)	—			—			6		4			(2		)	—			8
Purchases (sales)	—			2			2		1			—			1			6
Transfers	(1		)	(1		)	61		—			—			—			59
Balance Dec 31, 2011	—			4			69		87			263			1			424
2012 Activity:
Unrealized gains (losses)	—			—			5		4			31			—			40
Purchases (sales)	—			—			1		(7		)	—			—			(6		)
Transfers	—			(4		)	—		—			—			(1		)	(5		)
Balance Dec 31, 2012	$	—		$	—		$	75	$	84		$	294		$	—		$	453

Portion of the benefit payments are expected to be paid

The Company’s portion of the benefit payments that are expected to be paid during the years ending December 31 is as follows:

			Other Postretirement
In millions	Pension		Benefits
2013	$	213	$	38
2014	195		39
2015	174		39
2016	180		40
2017	188		41
Years 2018-2022	974		210

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Inventories (Tables)

12 Months Ended

Dec. 31, 2012

Inventory Disclosure [Abstract]

Inventories

Inventories at December 31, 2012 and 2011 were as follows:

In millions	2012		2011
Raw material	$	539	$	596
Work-in-process	152		156
Finished goods	894		964
	$	1,585	$	1,716

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Stockholders' Equity (Details Textual) (USD $) Share data in Millions, except Per Share data, unless otherwise specified	12 Months Ended					0 Months Ended	12 Months Ended		0 Months Ended	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 Pension	Dec. 31, 2012 Other Postretirement Benefits	Aug. 20, 2007 2007 Program [Member]	Dec. 31, 2011 2007 Program [Member]	Dec. 31, 2010 2007 Program [Member]	May 06, 2011 2011 Program [Member]	Dec. 31, 2012 2011 Program [Member]	Dec. 31, 2011 2011 Program [Member]
Defined Benefit Plan Disclosure [Line Items]
Stock repurchase program, authorized amount						$ 3,000,000,000			$ 4,000,000,000
Shareholders Equity (Textual) [Abstract]
Preferred stock, par value	$ 0
Preferred stock, shares authorized	0.3
Common stock, par value	$ 0.01
Shares repurchased							16.3	8.1		35.5	1.8
Shares repurchased average price							$ 53.51	$ 43.29		$ 56.93	$ 43.20
Authorized repurchases remaining under the repurchase program							0			1,900,000,000
Cash dividend declared per share	$ 1.48	$ 1.40	$ 1.30
Cash dividend paid per share	$ 1.84	$ 1.38	$ 1.27
Accelerated cash dividends per share	$ 0.38
Tax on pension and other postretirement benefits actuarial gains (losses)	(55,000,000)	(54,000,000)	(3,000,000)
Tax on amortization of unrecognized pension and other postretirement benefits costs	22,000,000	(17,000,000)	(12,000,000)
Tax on pension and other postretirement benefits settlements, curtailments and other	(21,000,000)	0	0
Foreign exchange translation adjustment related to deduction of foreign exchange losses on intercompany loan	55,000,000
Cumulative translation adjustment income included in accumulated comprehensive income	867,000,000	773,000,000
Unrecognized pension and other postretirement benefits costs included in accumulated comprehensive income	574,000,000	549,000,000
Estimated unrecognized benefit cost that will be amortized from accumulated other comprehensive income into net periodic benefit cost in 2012				$ 76,000,000	$ 2,000,000

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Acquisitions (Details Textual) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Business Combinations [Abstract]
Expected tax deductible goodwill recorded for acquisitions	$ 15	$ 302	$ 51

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Stock-Based Compensation (Details 2) (USD $) In Millions, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012
Option Activity [Roll Forward]
Number of Shares, Under Option, January 1, 2012	17.5
Number of Shares, Granted	1.8
Number of Shares, Exercised	(6.3)
Number of Shares, Cancelled or Expired	(0.2)
Number of Shares, Under Option, December 31, 2012	12.8
Weighted-Average Exercise Price, Under Option, January 1, 2012	$ 46.57
Weighted-Average Exercise Price, Granted	$ 55.72
Weighted-Average Exercise Price, Exercised	$ 45.23
Weighted-Average Exercise Price, Cancelled or Expired	$ 48.33
Weighted-Average Exercise Price, Under Option, December 31, 2012	$ 48.50
Weighted-Average Remaining Contractual Term, Under Option, December 31, 2012	6 years 0 months 4 days
Aggregate Intrinsic Value, Under Option, December 31, 2012	$ 157
Number of Shares, Exercisable, December 31, 2012	9.5
Weighted-Average Exercise Price, Exercisable, December 31, 2012	$ 47.49
Weighted-Average Remaining Contractual Term, Exercisable, December 31, 2012	5 years 3 months 11 days
Aggregate Intrinsic Value, Exercisable, December 31, 2012	$ 127

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Short-Term Debt (Tables)

12 Months Ended

Dec. 31, 2012

Debt Disclosure [Abstract]

Short-Term Debt

Short-Term Debt as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Commercial paper	$	408	$	192
Bank overdrafts	40		38
Current maturities of long-term debt	6		262
Other borrowings	5		10
	$	459	$	502

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Income Taxes (Details 2) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Components of deferred income tax assets and liabilities
Asset	$ 1,785	$ 1,862
Liability	(1,314)	(984)
Goodwill and intangible assets
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	382	355
Deferred Tax Liabilities, Gross	(901)	(787)
Inventory reserves, capitalized tax cost and LIFO inventory
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	68	76
Deferred Tax Liabilities, Gross	(11)	(13)
Investments
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	37	36
Deferred Tax Liabilities, Gross	(283)	(56)
Plant and equipment
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	14	28
Deferred Tax Liabilities, Gross	(103)	(107)
Accrued expenses and reserves
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	58	79
Deferred Tax Liabilities, Gross	0	0
Employee benefit accruals
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	362	351
Deferred Tax Liabilities, Gross	0	0
Foreign tax credit carryforwards
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	31	12
Deferred Tax Liabilities, Gross	0	0
Net operating loss carryforwards
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	709	623
Deferred Tax Liabilities, Gross	0	0
Capital loss carryforwards
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	37	34
Deferred Tax Liabilities, Gross	0	0
Allowances for uncollectible accounts
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	17	20
Deferred Tax Liabilities, Gross	0	0
Pension liabilities
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	102	113
Deferred Tax Liabilities, Gross	0	0
Deferred intercompany deductions
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	321	460
Deferred Tax Liabilities, Gross	0	0
Other
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	122	124
Deferred Tax Liabilities, Gross	(16)	(21)
Gross deferred income tax assets (liabilities)
Components of deferred income tax assets and liabilities
Deferred Tax Assets, Gross	2,260	2,311
Deferred Tax Liabilities, Gross	(1,314)	(984)
Valuation allowances
Components of deferred income tax assets and liabilities
Asset	(475)	(449)
Liability	$ 0	$ 0

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Pension and Other Postretirement Benefits (Details 2) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Pension
Change in plan assets:
Fair value of plan assets at January 1	$ 2,054	$ 1,941
Actual return on plan assets	240	108
Company contributions	190	131
Plan participants’ contributions	6	8
Acquisitions/divestitures	(38)	15
Benefits paid	(196)	(142)
Foreign currency translation	32	(7)
Fair value of plan assets at December 31	2,288	2,054
Amendments	5	0
Other Postretirement Benefits
Change in plan assets:
Fair value of plan assets at January 1	297	294
Actual return on plan assets	31	3
Company contributions	30	33
Plan participants’ contributions	15	15
Acquisitions/divestitures	0	0
Benefits paid	(45)	(48)
Foreign currency translation	0	0
Fair value of plan assets at December 31		297
Amendments	$ 0	$ 0

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Income Per Share from Continuing Operations (Tables)

12 Months Ended

Dec. 31, 2012

Earnings Per Share [Abstract]

Income Per Share from Continuing Operations

The computation of income per share from continuing operations was as follows:

In millions except per share amounts	2012		2011		2010
Income from continuing operations	$	2,495	$	2,017	$	1,452
Income per share from continuing operations—Basic:
Weighted-average common shares	469.8		491.4		500.8
Income per share from continuing operations—Basic	$	5.31	$	4.10	$	2.90
Income per share from continuing operations—Diluted:
Weighted-average common shares	469.8		491.4		500.8
Effect of dilutive stock options and restricted stock units	3.4		3.2		2.5
Weighted-average common shares assuming dilution	473.2		494.6		503.3
Income per share from continuing operations—Diluted	$	5.27	$	4.08	$	2.89

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Other Noncurrent Liabilities

12 Months Ended

Dec. 31, 2012

Other Liabilities Disclosure [Abstract]

Other Noncurrent Liabilities

Other Noncurrent Liabilities at December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Pension benefit obligation	$	470	$	481
Postretirement benefit obligation	261		272
Other	524		615
	$	1,255	$	1,368

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Income Taxes (Details 3) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	$ 2,379
2013 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	5
2014 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	4
2015 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	4
2016 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	8
2017 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	17
2018 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	23
2019 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	24
2020 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	72
2021 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	74
2022 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	20
2023 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	14
2024 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	11
2025 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	10
2026 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	7
2027 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	13
2028 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	6
2029 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	7
2030 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	5
2031 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	1
2032 [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	23
Do Not Expire [Member]
Gross Net Operating Loss Carryforwards [Abstract]
Net Operating Loss Carryforwards	$ 2,031

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Other Noncurrent Liabilities (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Other Noncurrent Liabilities
Pension benefit obligation	$ 470	$ 481
Postretirement benefit obligation	261	272
Other	524	615
Other Noncurrent Liabilities	$ 1,255	$ 1,368

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Segment Information (Details) (USD $) In Millions, unless otherwise specified	10 Months Ended	12 Months Ended
	Oct. 31, 2012	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Operating revenues:
Operating Revenues by Operating Segment		$ 17,924	$ 17,787	$ 15,416
Operating income:
Operating Income		2,847	2,731	2,254
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		613	594	549
Plant and equipment additions:
Plant and equipment additions		382	353	288
Identifiable assets:
Identifiable assets		19,309	17,984
All Segments [Member]
Operating revenues:
Operating Revenues by Operating Segment		17,003	16,703	14,424
Operating income:
Operating Income		2,725	2,599	2,137
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		595	572	529
Plant and equipment additions:
Plant and equipment additions		364	330	265
Identifiable assets:
Identifiable assets		13,957	13,582
Transportation [Member]
Operating revenues:
Operating Revenues by Operating Segment		3,550	3,444	2,839
Operating income:
Operating Income		560	539	427
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		144	132	105
Plant and equipment additions:
Plant and equipment additions		127	105	74
Identifiable assets:
Identifiable assets		2,981	2,835
Power Systems and Electronics [Member]
Operating revenues:
Operating Revenues by Operating Segment		3,151	2,988	2,518
Operating income:
Operating Income		643	605	493
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		96	90	82
Plant and equipment additions:
Plant and equipment additions		52	43	27
Identifiable assets:
Identifiable assets		2,451	2,516
Industrial Packaging
Operating revenues:
Operating Revenues by Operating Segment		2,412	2,463	2,123
Operating income:
Operating Income		282	249	208
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		66	69	67
Plant and equipment additions:
Plant and equipment additions		40	27	34
Identifiable assets:
Identifiable assets		1,786	1,825
Food Equipment
Operating revenues:
Operating Revenues by Operating Segment		1,939	1,985	1,860
Operating income:
Operating Income		324	304	255
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		47	50	44
Plant and equipment additions:
Plant and equipment additions		34	36	31
Identifiable assets:
Identifiable assets		979	1,022
Construction Products
Operating revenues:
Operating Revenues by Operating Segment		1,902	1,959	1,753
Operating income:
Operating Income		200	225	192
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		57	58	59
Plant and equipment additions:
Plant and equipment additions		28	37	28
Identifiable assets:
Identifiable assets		1,463	1,505
Polymers and Fluids [Member]
Operating revenues:
Operating Revenues by Operating Segment		1,230	1,250	1,001
Operating income:
Operating Income		195	188	167
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		49	48	38
Plant and equipment additions:
Plant and equipment additions		21	22	14
Identifiable assets:
Identifiable assets		1,322	1,340
All Other
Operating revenues:
Operating Revenues by Operating Segment		2,883	2,690	2,407
Operating income:
Operating Income		521	489	395
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		136	125	134
Plant and equipment additions:
Plant and equipment additions		62	60	57
Identifiable assets:
Identifiable assets		2,975	2,539
Intersegment revenues [Member]
Operating revenues:
Operating Revenues by Operating Segment		(64)	(76)	(77)
Corporate [Member]
Identifiable assets:
Identifiable assets		5,352	3,616
Assets held for sale
Identifiable assets:
Identifiable assets		0	386
Decorative Surfaces
Operating revenues:
Operating Revenues by Operating Segment	921	921	1,084	992
Operating income:
Operating Income	122	122	132	117
Depreciation and amortization and impairment of goodwill and intangible assets:
Depreciation and amortization and impairment of goodwill and intangible assets		18	22	20
Plant and equipment additions:
Plant and equipment additions		18	23	23
Identifiable assets:
Identifiable assets		$ 0	$ 400

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Rental Expense (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Future minimum lease payments
2013	$ 153
2014	113
2015	81
2016	61
2017	47
2018 and future years	67
Total	522
Rental Expense (Textual) [Abstract]
Rental Expenses	$ 178	$ 178	$ 165

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Net Plant and Equipment Components of Plant and Equipment (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Property, Plant and Equipment [Abstract]
Land	$ 237	$ 248
Buildings and improvements	1,496	1,567
Machinery and equipment	3,761	3,972
Equipment leased to others	180	187
Construction in progress	157	113
Gross plant and equipment	5,831	6,087
Accumulated depreciation	(3,837)	(4,062)
Net plant and equipment	$ 1,994	$ 2,025

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Long-Term Debt (Tables)

12 Months Ended

Dec. 31, 2012

Debt Disclosure [Abstract]

Schedule of Debt Instruments [Table Text Block]

Long-Term Debt at carrying value and fair value as of December 31, 2012 and 2011 consisted of the following:

	2012					2011
In millions	Carrying Value			Fair Value		Carrying Value			Fair Value
6.55% preferred debt securities due December 31, 2011	$	—		$	—	$	250		$	250
5.15% notes due April 1, 2014	800			846		800			877
5.25% Euro notes due October 1, 2014	989			1,071		971			1,064
6.25% notes due April 1, 2019	700			877		700			872
4.88% notes due thru December 31, 2020	12			13		22			24
3.375% notes due September 15, 2021	349			381		348			368
4.875% notes due September 15, 2041	641			770		641			761
3.9% notes due September 1, 2042	1,089			1,132		—			—
Other borrowings	15			15		18			18
	$	4,595		$	5,105	$	3,750		$	4,234
Current maturities	(6		)			(262		)
	$	4,589				$	3,488

Scheduled maturities of long-term debt

Scheduled maturities of long-term debt for the future years ending December 31 are as follows:

In millions
2013	$	6
2014	1,793
2015	2
2016	1
2017	1
2018 and future years	2,792
	$	4,595

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Pension and Other Postretirement Benefits (Details 7) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Level 3 assets measured at fair value for pension and other postretirement benefit plans
Beginning Balance	$ 424	$ 347
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings		4
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss)	40	8
Purchases (sales)	(6)	6
Transfers	(5)	59
Ending Balance	453	424
Government securities
Level 3 assets measured at fair value for pension and other postretirement benefit plans
Beginning Balance	0	1
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings		0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss)	0	0
Purchases (sales)	0	0
Transfers	0	(1)
Ending Balance	0	0
Corporate debt securities
Level 3 assets measured at fair value for pension and other postretirement benefit plans
Beginning Balance	4	3
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings		0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss)	0	0
Purchases (sales)	0	2
Transfers	(4)	(1)
Ending Balance	0	4
Investment contracts with insurance companies
Level 3 assets measured at fair value for pension and other postretirement benefit plans
Beginning Balance	69	0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings		0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss)	5	6
Purchases (sales)	1	2
Transfers	0	61
Ending Balance	75	69
Partnerships/ Private Equity Interests
Level 3 assets measured at fair value for pension and other postretirement benefit plans
Beginning Balance	87	78
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings		4
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss)	4	4
Purchases (sales)	(7)	1
Transfers	0	0
Ending Balance	84	87
Life insurance policies
Level 3 assets measured at fair value for pension and other postretirement benefit plans
Beginning Balance	263	265
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings		0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss)	31	(2)
Purchases (sales)	0	0
Transfers	0	0
Ending Balance	294	263
Other
Level 3 assets measured at fair value for pension and other postretirement benefit plans
Beginning Balance	1	0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings		0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss)	0	0
Purchases (sales)	0	1
Transfers	(1)	0
Ending Balance	$ 0	$ 1

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Income Taxes (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
U.S. federal income taxes:
Current	$ 566	$ 515	$ 397
Deferred	250	(34)	(46)
Provision for federal income taxes	816	481	351
Foreign income taxes:
Current	275	147	266
Deferred	(29)	(82)	(19)
Benefit of net operating loss carryforwards	(30)	(4)	(3)
Provision for foreign income taxes	216	61	244
State income taxes:
Current	71	65	52
Deferred	5	(31)	(3)
Benefit of net operating loss carryforwards	0	0	(7)
Provision for state income taxes	76	34	42
Provision for income taxes	$ 1,108	$ 576	$ 637

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Inventories (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Inventories
Inventory, Raw Materials, Net of Reserves	$ 539	$ 596
Inventory, Work in Process, Net of Reserves	152	156
Inventory, Finished Goods, Net of Reserves	894	964
Total Inventories	1,585	1,716
Inventories (Textual) [Abstract]
Percentage of U.S. inventory costed under LIFO method	44.00%
Percentage of total inventories priced at LIFO	21.00%	22.00%
Increase in total inventories if the FIFO method was used for all inventories	$ 101	$ 128

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Income Taxes (Details 5)	12 Months Ended
	Dec. 31, 2012
Minimum [Member] | United States – Federal
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2004
Minimum [Member] | United Kingdom
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2000
Minimum [Member] | Germany
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2006
Minimum [Member] | France
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2004
Minimum [Member] | Australia
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2006
Maximum [Member] | United States – Federal
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2012
Maximum [Member] | United Kingdom
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2012
Maximum [Member] | Germany
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2012
Maximum [Member] | France
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2012
Maximum [Member] | Australia
Open tax years for the Company's major jurisdictions
Open tax years by major tax jurisdiction	2012

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Prepaid Expenses and Other Current Assets (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Prepaid Expense and Other Assets, Current [Abstract]
Income tax refunds receivable	$ 231	$ 112
Value-added-tax receivables	71	65
Vendor advances	52	40
Other	168	167
Total prepaid expenses and other current assets	$ 522	$ 384

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Income Taxes (Details 1) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Income from continuing operations before income taxes
Domestic	$ 2,471	$ 1,452	$ 1,217
Foreign	1,132	1,141	872
Income from Continuing Operations Before Income Taxes	$ 3,603	$ 2,593	$ 2,089
Reconciliation between the U.S. Federal statutory tax rate and the effective tax rate
U.S. federal statutory tax rate	35.00%	35.00%	35.00%
State income taxes, net of U.S. federal tax benefit	0.90%	1.10%	1.20%
Differences between U.S. federal statutory and foreign tax rates	(2.30%)	(2.70%)	(2.00%)
Nontaxable foreign interest income	(2.50%)	(3.60%)	(3.40%)
Australian court decision	0.00%	(6.40%)	0.00%
Tax effect of foreign dividends	0.60%	0.40%	0.50%
Tax relief for U.S. manufacturers	(1.10%)	(1.30%)	(1.30%)
Other, net	0.10%	(0.30%)	0.50%
Effective tax rate	30.70%	22.20%	30.50%

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Operating Revenues (Details)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Operating Revenues (Textual) [Abstract]
Percentage of consolidated revenues not exceeded by any single customer	5.00%	5.00%	5.00%

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Plant and Equipment

12 Months Ended

Dec. 31, 2012

Property, Plant and Equipment [Abstract]

Net Plant and Equipment

Net Plant and Equipmentare stated at cost, less accumulated depreciation. Renewals and improvements that increase the useful life of plant and equipment are capitalized. Maintenance and repairs are charged to expense as incurred.

Depreciation was $323 million in 2012, $334 million in 2011 and $328 million in 2010, and was reflected primarily in cost of revenues. Depreciation included in income from discontinued operations was $2 million in 2011 and $7 million in 2010. There was no depreciation included in income from discontinued operations in 2012. Depreciation of plant and equipment for financial reporting purposes is computed on an accelerated basis for U.S. businesses and on a straight-line basis for a majority of the international businesses.

Net plant and equipment consisted of the following at December 31, 2012 and 2011:

In millions	2012			2011
Land	$	237		$	248
Buildings and improvements	1,496			1,567
Machinery and equipment	3,761			3,972
Equipment leased to others	180			187
Construction in progress	157			113
Gross plant and equipment	5,831			6,087
Accumulated depreciation	(3,837		)	(4,062		)
Net plant and equipment	$	1,994		$	2,025

The ranges of useful lives used to depreciate plant and equipment are as follows:

Buildings and improvements	5—50 years
Machinery and equipment	3—12 years
Equipment leased to others	Term of lease

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Plant and Equipment (Tables)

12 Months Ended

Dec. 31, 2012

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment [Table Text Block]

Net plant and equipment consisted of the following at December 31, 2012 and 2011:

In millions	2012			2011
Land	$	237		$	248
Buildings and improvements	1,496			1,567
Machinery and equipment	3,761			3,972
Equipment leased to others	180			187
Construction in progress	157			113
Gross plant and equipment	5,831			6,087
Accumulated depreciation	(3,837		)	(4,062		)
Net plant and equipment	$	1,994		$	2,025

Range of useful lives used to depreciate plant and equipment

The ranges of useful lives used to depreciate plant and equipment are as follows:

Buildings and improvements	5—50 years
Machinery and equipment	3—12 years
Equipment leased to others	Term of lease

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Acquisitions (Tables)

12 Months Ended

Dec. 31, 2012

Business Combinations [Abstract]

Summarized information related to acquisitions

Summarized information related to acquisitions is as follows:

In millions except number of acquisitions	2012		2011		2010
Number of acquisitions	23		28		24
Net cash paid during the year	$	723	$	1,308	$	497

Premium over tangible net assets recorded for acquisitions based on purchase price allocations

The premium over tangible net assets recorded for acquisitions based on purchase price allocations during 2012, 2011 and 2010 was as follows:

	2012			2011			2010
In millions except weighted-average lives (years)	Weighted- Average Life	Premium Recorded		Weighted- Average Life	Premium Recorded		Weighted- Average Life	Premium Recorded
Goodwill		$	333		$	476		$	219
Amortizable intangible assets:
Customer lists and relationships	12.2	169		12.2	362		11.8	121
Patents and proprietary technology	8.2	38		9.6	98		10.9	32
Trademarks and brands	12.8	36		17.3	245		14.9	71
Noncompete agreements	4.5	29		5.0	27		5.3	5
Other	7.2	12		1.8	11		4.9	12
Total amortizable intangible assets	10.7	284		13.1	743		12.1	241
Indefinite-lived intangible assets:
Trademarks and brands		42			5			—
Total premium recorded		$	659		$	1,224		$	460

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Other Income Expense (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Other Nonoperating Income (Expense) [Abstract]
Interest income	$ 40	$ 40	$ 24
Gain (loss) on disposal of operations and affiliates	22	2	(8)
Income from investments	11	17	21
Gain (loss) on foreign currency transactions, net	(11)	(4)	(17)
Equity loss in Wilsonart	(30)	0	0
Other, net	5	(1)	(10)
Total	$ 37	$ 54	$ 10

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Goodwill and Intangible Assets (Details 3) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Amortizable intangible assets:
Amortizable intangible assets, Cost	$ 3,620	$ 3,368
Amortizable intangible assets, Accumulated Amortization	(1,606)	(1,338)
Amortizable intangible assets, Net	2,014	2,030
Total intangible assets, Net	2,258	2,233
Total intangible assets, Cost	3,864	3,571
Customer lists and relationships
Amortizable intangible assets:
Amortizable intangible assets, Cost	1,749	1,608
Amortizable intangible assets, Accumulated Amortization	(661)	(522)
Amortizable intangible assets, Net	1,088	1,086
Patents and proprietary technology
Amortizable intangible assets:
Amortizable intangible assets, Cost	593	561
Amortizable intangible assets, Accumulated Amortization	(285)	(236)
Amortizable intangible assets, Net	308	325
Trademarks and brands
Amortizable intangible assets:
Amortizable intangible assets, Cost	747	700
Amortizable intangible assets, Accumulated Amortization	(206)	(157)
Amortizable intangible assets, Net	541	543
Software
Amortizable intangible assets:
Amortizable intangible assets, Cost	206	201
Amortizable intangible assets, Accumulated Amortization	(188)	(172)
Amortizable intangible assets, Net	18	29
Noncompete agreements
Amortizable intangible assets:
Amortizable intangible assets, Cost	204	181
Amortizable intangible assets, Accumulated Amortization	(157)	(148)
Amortizable intangible assets, Net	47	33
Other
Amortizable intangible assets:
Amortizable intangible assets, Cost	121	117
Amortizable intangible assets, Accumulated Amortization	(109)	(103)
Amortizable intangible assets, Net	12	14
Trademarks [Member]
Amortizable intangible assets:
Indefinite-lived intangible assets	$ 244	$ 203

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Segment Information

12 Months Ended

Dec. 31, 2012

Segment Reporting [Abstract]

Segment Information

Segment Information—The Company has 40 operating segments which are aggregated from the Company's more than 750 operations in 58 countries. These businesses are internally reported as 40 operating segments to senior management and have been aggregated into the following seven external reportable segments: Transportation; Power Systems & Electronics; Industrial Packaging; Food Equipment; Construction Products; Polymers & Fluids; and All Other.

As discussed in the Divestiture of Majority Interest in Decorative Surfaces Segment note, the Company ceased consolidating the results of the Decorative Surfaces segment as of October 31, 2012 and now reports its 49% ownership interest in Wilsonart using the equity method of accounting. Effective November 1, 2012, the Company made changes to its management reporting structure and Decorative Surfaces is no longer a reportable segment of the Company.

Transportation—Transportation-related components, fasteners, fluids and polymers, as well as truck remanufacturing and related parts and service.

Power Systems & Electronics—Equipment and consumables associated with specialty power conversion, metallurgy and electronics.

Industrial Packaging—Steel, plastic and paper products and equipment used for bundling, shipping and protecting goods in transit.

Food Equipment—Commercial food equipment and related service.

Construction Products—Construction fastening systems and truss products.

Polymers & Fluids—Adhesives, sealants, lubrication and cutting fluids, and hygiene products.

All Other—All other operating segments.

Segment information for 2012, 2011 and 2010 was as follows:

In millions	2012			2011			2010
Operating revenues:
Transportation	$	3,550		$	3,444		$	2,839
Power Systems & Electronics	3,151			2,988			2,518
Industrial Packaging	2,412			2,463			2,123
Food Equipment	1,939			1,985			1,860
Construction Products	1,902			1,959			1,753
Polymers & Fluids	1,230			1,250			1,001
All Other	2,883			2,690			2,407
Intersegment revenues	(64		)	(76		)	(77		)
Total Segments	$	17,003		$	16,703		$	14,424
Decorative Surfaces	921			1,084			992
Total	$	17,924		$	17,787		$	15,416
Operating income:
Transportation	$	560		$	539		$	427
Power Systems & Electronics	643			605			493
Industrial Packaging	282			249			208
Food Equipment	324			304			255
Construction Products	200			225			192
Polymers & Fluids	195			188			167
All Other	521			489			395
Total Segments	$	2,725		$	2,599		$	2,137
Decorative Surfaces	122			132			117
Total	$	2,847		$	2,731		$	2,254
Depreciation and amortization and impairment of goodwill and intangible assets:
Transportation	$	144		$	132		$	105
Power Systems & Electronics	96			90			82
Industrial Packaging	66			69			67
Food Equipment	47			50			44
Construction Products	57			58			59
Polymers & Fluids	49			48			38
All Other	136			125			134
Total Segments	$	595		$	572		$	529
Decorative Surfaces	18			22			20
Total	$	613		$	594		$	549
Plant and equipment additions:
Transportation	$	127		$	105		$	74
Power Systems & Electronics	52			43			27
Industrial Packaging	40			27			34
Food Equipment	34			36			31
Construction Products	28			37			28
Polymers & Fluids	21			22			14
All Other	62			60			57
Total Segments	$	364		$	330		$	265
Decorative Surfaces	18			23			23
Total	$	382		$	353		$	288
Identifiable assets:
Transportation	$	2,981		$	2,835
Power Systems & Electronics	2,451			2,516
Industrial Packaging	1,786			1,825
Food Equipment	979			1,022
Construction Products	1,463			1,505
Polymers & Fluids	1,322			1,340
All Other	2,975			2,539
Total Segments	$	13,957		$	13,582
Corporate	5,352			3,616
Assets held for sale	—			386
Decorative Surfaces	—			400
Total	$	19,309		$	17,984

Identifiable assets by segment are those assets that are specifically used in that segment. Corporate assets are principally cash and equivalents, investments and other general corporate assets.

2011 and 2012 Segment Changes—In the first quarter of 2011, the Company made certain changes in its management reporting structure that resulted in changes in some of the reportable segments. The pressure sensitive adhesives, and the static and contamination control reporting units were moved to the Power Systems & Electronics segment from the Polymers & Fluids and All Other segments, respectively. The changes in the reportable segments and underlying reporting units did not result in any goodwill impairment charges in the first quarter of 2011.

In the first quarter of 2012, the Company made certain changes in its management reporting structure that resulted in changes in some of the reportable segments. These changes primarily related to the industrial fasteners reporting unit, formerly in the All Other segment, moving to the Transportation segment; certain businesses in a Latin American reporting unit, formerly in the Polymers & Fluids segment, moving to the Transportation segment; and a worldwide insulation reporting unit, formerly in the Industrial Packaging segment, moving to the Power Systems & Electronics segment. The changes in the reportable segments and underlying reporting units did not result in any goodwill impairment charges in the first quarter of 2012.

2013 Segment Changes—Effective January 1, 2013, the Company made certain changes in how its operations are reported to senior management in order to better align its portfolio of businesses with its enterprise-wide portfolio management initiative.

As a result of this reorganization, the Company's operations will be prospectively aggregated into the following eight external reportable segments: Industrial Packaging; Test & Measurement and Electronics; Automotive OEM; Polymers & Fluids; Food Equipment; Construction Products; Welding; and Specialty Products.

The significant changes resulting from this reorganization include the following:

• Certain businesses within the former Transportation segment, primarily related to the automotive aftermarket business, will be reported in the Polymers & Fluids segment and the Transportation segment will be renamed Automotive OEM.

• The Welding business, which was formerly reported in the Power Systems & Electronics segment, will be reported separately as the Welding segment.

• The Electronics business, which was formerly reported in the Power Systems & Electronics segment, will be combined with the Test & Measurement business, which was formerly reported in the All Other segment, to form a new Test & Measurement and Electronics segment.

• The All Other segment will be renamed Specialty Products.

The 2012 Annual Report on Form 10-K has not been restated for these changes in segment reporting. Results for 2012 and prior periods are reported on the basis under which the Company managed its business in 2012 and do not reflect the January 2013 reorganization described above.

Enterprise-wide information for 2012, 2011 and 2010 was as follows:

In millions	2012		2011		2010
Operating Revenues by Geographic Region:
United States	$	7,714	$	7,379	$	6,462
Europe	5,090		5,492		4,806
Asia	2,097		1,932		1,698
Other North America	1,222		1,161		1,018
Australia/New Zealand	864		885		781
Other	937		938		651
	$	17,924	$	17,787	$	15,416

Operating revenues by geographic region are based on the customers’ locations.

The Company has thousands of product lines within its businesses; therefore, providing operating revenues by product line is not practicable.

Total noncurrent assets excluding deferred tax assets and financial instruments were $11.0 billion and $10.2 billion at December 31, 2012 and 2011, respectively. Of these amounts, approximately 53% and 52% was attributed to U.S. operations for 2012 and 2011, respectively. The remaining amounts were attributed to the Company’s foreign operations, with no single country accounting for a significant portion.

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Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Fair Value of Intangible Assets [Table Text Block]

A summary of goodwill and indefinite-lived intangible assets that were adjusted to fair value and the related impairment charges included in earnings for 2012, 2011 and 2010 is as follows:

	2012						2011						2010
In millions	Book Value		Fair Value		Total Impairment Charges		Book Value		Fair Value		Total Impairment Charges		Book Value		Fair Value		Total Impairment Charges
Goodwill	$	146	$	145	$	1	$	—	$	—	$	—	$	—	$	—	$	—
Indefinite-lived intangible assets	5		4		1		—		—		—		20		19		1

Amortization and impairment of goodwill and other intangible assets

Amortization and impairment of goodwill and other intangible assets for the years ended December 31, 2012, 2011 and 2010 were as follows:

In millions	2012		2011		2010
Goodwill:
Impairment	$	1	$	—	$	—
Intangible Assets:
Amortization	288		255		207
Impairment	1		—		1
	$	290	$	255	$	208

Carrying amount of goodwill by segment

The changes in the carrying amount of goodwill for the years ended December 31, 2012 and 2011 were as follows:

In millions	Transpor-tation			Power Systems & Electronics			Industrial Packaging			Food Equipment			Construction Products			Polymers & Fluids			Decorative Surfaces			All Other			Total
Balance, December 31, 2010	$	567		$	429		$	769		$	204		$	585		$	844		$	13		$	1,561		$	4,972
2011 activity:
Acquisitions & divestitures	118			242			25			(1		)	6			50			—			24			464
Impairment charges	—			—			—			—			—			—			—			—			—
Foreign currency translation	(9		)	(3		)	(11		)	(4		)	(1		)	(17		)	—			(3		)	(48		)
Transfer to assets held for sale	—			(7		)	—			—			—			—			—			(183		)	(190		)
Intersegment goodwill transfers	1			342			—			—			—			(156		)	—			(187		)	—
Balance, December 31, 2011	$	677		$	1,003		$	783		$	199		$	590		$	721		$	13		$	1,212		$	5,198
2012 activity:
Acquisitions & divestitures	8			19			(6		)	1			6			38			(13		)	231			284
Impairment charges	—			(1		)	—			—			—			—			—			—			(1		)
Foreign currency translation	11			8			10			3			7			(2		)	—			12			49
Intersegment goodwill transfers	78			53			(52		)	—			—			(43		)	—			(36		)	—
Balance, December 31, 2012	$	774		$	1,082		$	735		$	203		$	603		$	714		$	—		$	1,419		$	5,530
Accumulated goodwill impairment charges, December 31, 2012	$	36		$	89		$	114		$	60		$	7		$	15		$	—		$	46		$	367

Intangible assets

Intangible assets as of December 31, 2012 and 2011 were as follows:

	2012							2011
In millions	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Amortizable intangible assets:
Customer lists and relationships	$	1,749	$	(661	)	$	1,088	$	1,608	$	(522	)	$	1,086
Patents and proprietary technology	593		(285		)	308		561		(236		)	325
Trademarks and brands	747		(206		)	541		700		(157		)	543
Software	206		(188		)	18		201		(172		)	29
Noncompete agreements	204		(157		)	47		181		(148		)	33
Other	121		(109		)	12		117		(103		)	14
Total amortizable intangible assets	3,620		(1,606		)	2,014		3,368		(1,338		)	2,030
Indefinite-lived intangible assets:
Trademarks and brands	244		—			244		203		—			203
Total intangible assets	$	3,864	$	(1,606	)	$	2,258	$	3,571	$	(1,338	)	$	2,233

Estimated amortization expense of intangible assets.

The estimated amortization expense of intangible assets for the future years ending December 31 is as follows:

In millions
2013	$	265
2014	249
2015	235
2016	221
2017	201

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Discontinued Operations (Details Textual) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Apr. 01, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Discontinued Operations and Disposal Groups [Abstract]
Cash Transaction Made through Definitive Agreement	$ 650
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax		(475)	4	(21)
Finishing Business [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax		452
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax		372
Consumer Packaging Business [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax		24
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax		3
Electronics Components Business [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax			(4)
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax			(3)
Security Printing Business [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax				20
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax				$ 5

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Pension and Other Postretirement Benefits (Details Textual) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2013 Pension	Dec. 31, 2013 Other Postretirement Benefits	Dec. 31, 2012 Equity securities	Dec. 31, 2012 Debt securities	Dec. 31, 2012 Other plan assets
Defined Benefit Plan Disclosure [Line Items]
Defined contribution plan expenses	$ 82	$ 78	$ 69
Target allocation for plan assets in equity securities, minimum						50.00%	30.00%	0.00%
Target allocation for plan assets in equity securities, maximum						65.00%	45.00%	10.00%
Maximum maturity period for cash on hand and investments included in Cash and Equivalents	90 days
Expected current year contributions for pension and other postretirement plans				$ 132	$ 9

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Segment Information (Tables)

12 Months Ended

Dec. 31, 2012

Segment Reporting [Abstract]

Segment Information

Segment information for 2012, 2011 and 2010 was as follows:

In millions	2012			2011			2010
Operating revenues:
Transportation	$	3,550		$	3,444		$	2,839
Power Systems & Electronics	3,151			2,988			2,518
Industrial Packaging	2,412			2,463			2,123
Food Equipment	1,939			1,985			1,860
Construction Products	1,902			1,959			1,753
Polymers & Fluids	1,230			1,250			1,001
All Other	2,883			2,690			2,407
Intersegment revenues	(64		)	(76		)	(77		)
Total Segments	$	17,003		$	16,703		$	14,424
Decorative Surfaces	921			1,084			992
Total	$	17,924		$	17,787		$	15,416
Operating income:
Transportation	$	560		$	539		$	427
Power Systems & Electronics	643			605			493
Industrial Packaging	282			249			208
Food Equipment	324			304			255
Construction Products	200			225			192
Polymers & Fluids	195			188			167
All Other	521			489			395
Total Segments	$	2,725		$	2,599		$	2,137
Decorative Surfaces	122			132			117
Total	$	2,847		$	2,731		$	2,254
Depreciation and amortization and impairment of goodwill and intangible assets:
Transportation	$	144		$	132		$	105
Power Systems & Electronics	96			90			82
Industrial Packaging	66			69			67
Food Equipment	47			50			44
Construction Products	57			58			59
Polymers & Fluids	49			48			38
All Other	136			125			134
Total Segments	$	595		$	572		$	529
Decorative Surfaces	18			22			20
Total	$	613		$	594		$	549
Plant and equipment additions:
Transportation	$	127		$	105		$	74
Power Systems & Electronics	52			43			27
Industrial Packaging	40			27			34
Food Equipment	34			36			31
Construction Products	28			37			28
Polymers & Fluids	21			22			14
All Other	62			60			57
Total Segments	$	364		$	330		$	265
Decorative Surfaces	18			23			23
Total	$	382		$	353		$	288
Identifiable assets:
Transportation	$	2,981		$	2,835
Power Systems & Electronics	2,451			2,516
Industrial Packaging	1,786			1,825
Food Equipment	979			1,022
Construction Products	1,463			1,505
Polymers & Fluids	1,322			1,340
All Other	2,975			2,539
Total Segments	$	13,957		$	13,582
Corporate	5,352			3,616
Assets held for sale	—			386
Decorative Surfaces	—			400
Total	$	19,309		$	17,984

Operating Revenues by Geographic Region

Enterprise-wide information for 2012, 2011 and 2010 was as follows:

In millions	2012		2011		2010
Operating Revenues by Geographic Region:
United States	$	7,714	$	7,379	$	6,462
Europe	5,090		5,492		4,806
Asia	2,097		1,932		1,698
Other North America	1,222		1,161		1,018
Australia/New Zealand	864		885		781
Other	937		938		651
	$	17,924	$	17,787	$	15,416

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Trade Receivables (Tables)

12 Months Ended

Dec. 31, 2012

Receivables [Abstract]

Changes in allowances for uncollectible accounts

The changes in the allowances for uncollectible accounts during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	(65	)	$	(70	)	$	(76	)
Provision charged to expense	(11		)	(5		)	(4		)
Write-offs, net of recoveries	14			10			12
Acquisitions and divestitures	—			(4		)	(3		)
Foreign currency translation	(1		)	2			1
Other	(2		)	2			—
Ending balance	$	(65	)	$	(65	)	$	(70	)

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International Reporting Lag

12 Months Ended

Dec. 31, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

International Reporting Lag

International Reporting Lag—Prior to 2011, the Company’s international operations outside of North America had a fiscal reporting period that began on December 1 and ended on November 30. Effective January 1, 2011, the Company eliminated the one-month lag for the reporting of its international operations outside of North America. As a result, the Company is now reporting both North American and international results on a calendar year basis. The Company determined that the elimination of the one-month reporting lag was preferable because the same period-end reporting date improves overall financial reporting as the impact of current events, economic conditions and global trends are consistently reflected in the financial statements of the North American and international businesses.

The Company applied this change in accounting principle retrospectively to all prior financial statement periods presented. The impact of the elimination of the one-month reporting lag for international operations outside of North America for the year ended December 31, 2010 was as follows:

	Increase (Decrease)
In millions except per share amounts	2010
Operating revenues	$	(22	)
Income from continuing operations	(25		)
Income from continuing operations per diluted share	(0.04		)
Net income	(24		)
Net income per diluted share	(0.04		)

The cumulative effect of adopting this change in accounting principle was recorded to income reinvested in the business as of January 1, 2009.

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Long-Term Debt (Details Textual)	12 Months Ended											12 Months Ended
	Dec. 31, 2012 USD ($)	Jun. 08, 2012 Line of credit terminating June 8, 2017 [Member] USD ($)	Jun. 30, 2011 Line of credit terminating June 10, 2016 [Member] USD ($)	Dec. 31, 2002 6.55% preferred debt securities due December 31, 2011 [Member] USD ($)	Dec. 31, 2005 4.88% notes due thru December 31, 2020 [Member] USD ($)	Dec. 31, 2007 5.25% Euro notes due October 1, 2014 [Member] EUR (€)	Dec. 31, 2009 5.15% notes due April 1, 2014 [Member] USD ($)	Dec. 31, 2009 6.25% notes due April 1, 2019 [Member] USD ($)	Dec. 31, 2011 3.375% notes due September 15, 2021 [Member] USD ($)	Dec. 31, 2011 4.875% notes due September 15, 2041 [Member] USD ($)	Dec. 31, 2012 3.9% notes due September 1, 2042 [Member] USD ($)	Dec. 31, 2012 Other borrowings [Member]	Jun. 08, 2012 Revolving credit facility terminated June 15, 2012 [Member] USD ($)	Jun. 08, 2012 Line of credit terminating June 11, 2013 [Member] USD ($)	Jun. 10, 2010 Line of credit terminated June 10, 2011 [Member] USD ($)
Long-Term Debt (Textual) [Abstract]
Face value of notes				$ 250,000,000	$ 54,000,000	€ 750,000,000	$ 800,000,000	$ 700,000,000	$ 350,000,000	$ 650,000,000	$ 1,100,000,000
Interest rate, stated percentage				6.55%	4.88%	5.25%	5.15%	6.25%	3.375%	4.875%	3.90%
Percentage of face value of notes issued				99.849%	100.00%	99.874%	99.92%	99.98%	99.552%	98.539%	99.038%
Effective interest rate				6.70%		5.30%	5.20%	6.30%	3.40%	4.90%	3.955%
Other borrowings interest rates, minimum												0.30%
Other borrowings interest rates, maximum												17.50%
Line of credit facility, outstanding		1,500,000,000	1,000,000,000										500,000,000	1,000,000,000	1,000,000,000
Line of credit facilities, terminated	0
Total debt, including guarantees, as percentage of total capitalization limitation in financial covenants	50.00%
Total debt, including guarantees, as percentage of total capitalization	34.30%
Open stand-by letters of credit	$ 194,000,000
Expiration of open stand-by letters of credit	2013
Expiration of open stand-by letters of credit	2014

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Notes to Financial Statements Nature of Operations (Details)	12 Months Ended
	Dec. 31, 2012 Country
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of countries with ITW operations	58

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Segment Information (Details 1) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Operating Revenues by Geographic Region:
Operating Revenues by Operating Segment	$ 17,924	$ 17,787	$ 15,416
United States [Member]
Operating Revenues by Geographic Region:
Operating Revenues by Operating Segment	7,714	7,379	6,462
Europe [Member]
Operating Revenues by Geographic Region:
Operating Revenues by Operating Segment	5,090	5,492	4,806
Asia [Member]
Operating Revenues by Geographic Region:
Operating Revenues by Operating Segment	2,097	1,932	1,698
Other North America [Member]
Operating Revenues by Geographic Region:
Operating Revenues by Operating Segment	1,222	1,161	1,018
Australia/New Zealand [Member]
Operating Revenues by Geographic Region:
Operating Revenues by Operating Segment	864	885	781
Other Geographic Region [Member]
Operating Revenues by Geographic Region:
Operating Revenues by Operating Segment	$ 937	$ 938	$ 651

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Rental Expense (Tables)

12 Months Ended

Dec. 31, 2012

Leases [Abstract]

Future minimum lease payments

Future minimum lease payments under non-cancelable leases for the years ending December 31 are as follows:

In millions
2013	$	153
2014	113
2015	81
2016	61
2017	47
2018 and future years	67
	$	522

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Pension and Other Postretirement Benefits

12 Months Ended

Dec. 31, 2012

Compensation and Retirement Disclosure [Abstract]

Pension and Other Postretirement Benefits Disclosure

Pension and Other Postretirement Benefits—The Company has both funded and unfunded defined benefit pension and other postretirement benefit plans, predominately in the U.S. covering a majority of U.S. employees.

The U.S. primary pension plan provides benefits based on years of service and final average salary. The U.S. primary postretirement health care plan is contributory with the participants’ contributions adjusted annually. The U.S. primary postretirement life insurance plan is noncontributory.

Beginning January 1, 2007, the U.S. primary pension and other postretirement benefit plans were closed to new participants. Newly hired employees and employees from acquired businesses that are not participating in these plans are eligible for additional Company contributions under the existing U.S. primary defined contribution retirement plans. The Company’s expense related to defined contribution plans was $82 million in 2012, $78 million in 2011 and $69 million in 2010.

In addition to the U.S. plans, the Company also has defined benefit pension plans in certain other countries, mainly the United Kingdom, Switzerland, Canada and Germany.

Summarized information regarding the Company’s significant defined benefit pension and other postretirement benefit plans related to both continuing and discontinued operations is as follows:

	Pension									Other Postretirement Benefits
In millions	2012			2011			2010			2012			2011			2010
Components of net periodic benefit cost:
Service cost	$	100		$	94		$	94		$	13		$	14		$	14
Interest cost	107			116			110			27			30			30
Expected return on plan assets	(157		)	(157		)	(150		)	(20		)	(21		)	(18		)
Amortization of actuarial loss	57			39			26			1			—			—
Amortization of prior service cost	1			1			1			3			6			6
Settlement/curtailment loss	14			—			1			—			—			—
	$	122		$	93		$	82		$	24		$	29		$	32

Net periodic benefit cost was included in the statement of income as follows:

	Pension						Other Postretirement Benefits
In millions	2012		2011		2010		2012		2011		2010
Income from continuing operations	$	121	$	89	$	80	$	24	$	29	$	32
Income from discontinued operations	1		4		2		—		—		—
	$	122	$	93	$	82	$	24	$	29	$	32

The following tables provide a rollforward of the plan benefit obligations, plan assets and a reconciliation of funded status for the years ended December 31, 2012 and 2011:

	Pension						Other Postretirement Benefits
In millions	2012			2011			2012			2011
Change in benefit obligation:
Benefit obligation at January 1	$	2,465		$	2,301		$	569		$	559
Service cost	100			94			13			14
Interest cost	107			116			27			30
Plan participants’ contributions	6			8			15			15
Amendments	5			—			—			—
Actuarial loss	204			79			45			—
Acquisitions/divestitures	(74		)	16			—			—
Benefits paid	(196		)	(142		)	(45		)	(48		)
Medicare subsidy received	—			—			3			3
Liabilities from (to) other immaterial plans	—			2			—			(4		)
Settlement/curtailment loss (gain)	5			—			(38		)	—
Foreign currency translation	33			(9		)	—			—
Benefit obligation at December 31	$	2,655		$	2,465		$	589		$	569

Change in plan assets:
Fair value of plan assets at January 1	$	2,054		$	1,941		$	297		$	294
Actual return on plan assets	240			108			31			3
Company contributions	190			131			30			33
Plan participants’ contributions	6			8			15			15
Acquisitions/divestitures	(38		)	15			—			—
Benefits paid	(196		)	(142		)	(45		)	(48		)
Foreign currency translation	32			(7		)	—			—
Fair value of plan assets at December 31	$	2,288		$	2,054		$	328		$	297
Funded status	$	(367	)	$	(411	)	$	(261	)	$	(272	)
Other immaterial plans	(58		)	(63		)	(7		)	(7		)
Net liability at December 31	$	(425	)	$	(474	)	$	(268	)	$	(279	)
The amounts recognized in the statement of financial position as of December 31 consist of:
Other assets	$	57		$	41		$	—		$	—
Accrued expenses	(12		)	(21		)	(7		)	(7		)
Liabilities held for sale	—			(13		)	—			—
Other noncurrent liabilities	(470		)	(481		)	(261		)	(272		)
Net liability at end of year	$	(425	)	$	(474	)	$	(268	)	$	(279	)
The pre-tax amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss	$	892		$	848		$	10		$	15
Prior service cost	7			4			2			5
	$	899		$	852		$	12		$	20
Accumulated benefit obligation	$	2,358		$	2,193
Plans with accumulated benefit obligation in excess of plan assets as of December 31:
Projected benefit obligation	$	1,928		$	1,838
Accumulated benefit obligation	$	1,741		$	1,665
Fair value of plan assets	$	1,524		$	1,414

Assumptions

The weighted-average assumptions used in the valuations of pension and other postretirement benefits were as follows:

	Pension						Other Postretirement Benefits
	2012		2011		2010		2012		2011		2010
Assumptions used to determine benefit obligations at December 31:
Discount rate	3.85	%	4.64	%	5.05	%	4.15	%	4.95	%	5.45	%
Rate of compensation increases	3.86	%	3.86	%	3.94	%	—	%	—	%	—	%
Assumptions used to determine net periodic benefit cost for years ended December 31:
Discount rate	4.64	%	5.05	%	5.57	%	4.95	%	5.45	%	5.80	%
Expected return on plan assets	7.23	%	7.39	%	7.63	%	7.00	%	7.00	%	7.00	%
Rate of compensation increases	3.86	%	3.94	%	4.18	%	—	%	—	%	—	%

The expected long-term rates of return for pension and other postretirement benefit plans were developed using historical asset class returns while factoring in current market conditions such as inflation, interest rates and asset class performance.

Assumed health care cost trend rates have an effect on the amounts reported for the postretirement health care benefit plans. The assumed health care cost trend rates used to determine the postretirement benefit obligation at December 31 were as follows:

	2012		2011		2010
Health care cost trend rate assumed for the next year	7.35	%	8.50	%	8.71	%
Ultimate trend rate	5.00	%	5.00	%	5.00	%
Year the rate reaches the ultimate trend rate	2019		2019		2020

A one percentage-point change in assumed health care cost trend rates would have the following impact:

In millions	1 Percentage-Point Increase		1 Percentage-Point Decrease
Change in service cost and interest cost for 2012	$	1	$	(1	)
Change in postretirement benefit obligation at December 31, 2012	$	13	$	(16	)

Plan Assets

The Company’s overall investment strategy for the assets in the pension funds is to achieve a balance between the goals of growing plan assets and keeping risk at a reasonable level over a long-term investment horizon. In order to reduce unnecessary risk, the pension funds are diversified across several asset classes, securities and investment managers. The target allocations for plan assets are 50% to 65% equity securities, 30% to 45% debt securities and 0% to 10% in other types of investments. The Company does not use derivatives for the purpose of speculation, leverage, circumventing investment guidelines or taking risks that are inconsistent with specified guidelines.

The assets in the Company’s postretirement health care plan are primarily invested in life insurance policies. The Company’s overall investment strategy for the assets in the postretirement health care fund is to invest in assets that provide a reasonable tax exempt rate of return while preserving capital.

The following tables present the fair value of the Company’s pension and other postretirement benefit plan assets at December 31, 2012 and 2011, by asset category and valuation methodology. Level 1 assets are valued using unadjusted quoted prices for identical assets in active markets. Level 2 assets are valued using quoted prices or other observable inputs for similar assets. Level 3 assets are valued using unobservable inputs, but reflect the assumptions market participants would be expected to use in pricing the assets. Each financial instrument’s categorization is based on the lowest level of input that is significant to the fair value measurement.

	2012
In millions	Level 1		Level 2		Level 3		Total
Pension Plan Assets:
Cash and equivalents	$	26	$	—	$	—	$	26
Equity securities:
Domestic	56		—		—		56
Foreign	85		—		—		85
Fixed income securities:
Government securities	—		245		—		245
Corporate debt securities	—		263		—		263
Mortgage-backed securities	—		12		—		12
Investment contracts with insurance companies	—		—		75		75
Commingled funds:
Mutual funds	387		—		—		387
Collective trust funds	—		1,055		—		1,055
Partnerships/private equity interests	—		—		84		84
	$	554	$	1,575	$	159	$	2,288
Other Postretirement Benefit Plan Assets:
Cash and equivalents	$	34	$	—	$	—	$	34
Life insurance policies	—		—		294		294
	$	34	$	—	$	294	$	328

	2011
In millions	Level 1		Level 2		Level 3		Total
Pension Plan Assets:
Cash and equivalents	$	17	$	—	$	—	$	17
Equity securities:
Domestic	56		—		—		56
Foreign	68		—		—		68
Fixed income securities:
Government securities	—		218		—		218
Corporate debt securities	—		240		4		244
Mortgage-backed securities	—		16		—		16
Investment contracts with insurance companies	—		—		69		69
Commingled funds:
Mutual funds	345		—		—		345
Collective trust funds	—		932		—		932
Partnerships/private equity interests	—		—		87		87
Other	—		1		1		2
	$	486	$	1,407	$	161	$	2,054
Other Postretirement Benefit Plan Assets:
Cash and equivalents	$	34	$	—	$	—	$	34
Life insurance policies	—		—		263		263
	$	34	$	—	$	263	$	297

Cash and equivalents include cash on hand and investments with maturities of 90 days or less and are valued at cost, which approximates fair value. Equity securities primarily include common and preferred equity securities covering a wide range of industries and geographies which are traded in active markets and are valued based on quoted prices. Fixed income securities primarily consist of U.S. and foreign government bills, notes and bonds, corporate debt securities, asset-backed securities and investment contracts. The majority of the assets in this category are valued by evaluating bid prices provided by independent financial data services. For securities where market data is not readily available, unobservable market data is used to value the security. Commingled funds include investments in public and private pooled funds. Mutual funds are traded in active markets and are valued based on quoted prices. The underlying investments include small-cap equity, international equity and long- and short-term fixed income instruments. Collective trust funds are private funds that are valued at the net asset value, which is determined based on the fair value of the underlying investments. The underlying investments include both passively and actively managed U.S. and foreign large- and mid-cap equity funds and short-term investment funds. Partnerships/private equity interests are investments in partnerships where the benefit plan is a limited partner. The investments are valued by the investment managers on a periodic basis using pricing models that use market, income and cost valuation methods. Life insurance policies are used to fund other postretirement benefits in order to obtain favorable tax treatment and are valued based on the cash surrender value of the underlying policies.

The following table presents a reconciliation of Level 3 assets measured at fair value for pension and other postretirement benefit plans during the years ended December 31, 2012 and 2011:

In millions	Government Securities			Corporate Debt Securities			Investment Contracts with Insurance Companies		Partnerships/ Private  Equity Interests			Life Insurance Policies			Other			Total
Balance Dec 31, 2010	$	1		$	3		$	—	$	78		$	265		$	—		$	347
2011 Activity:
Realized gains (losses)	—			—			—		4			—			—			4
Unrealized gains (losses)	—			—			6		4			(2		)	—			8
Purchases (sales)	—			2			2		1			—			1			6
Transfers	(1		)	(1		)	61		—			—			—			59
Balance Dec 31, 2011	—			4			69		87			263			1			424
2012 Activity:
Unrealized gains (losses)	—			—			5		4			31			—			40
Purchases (sales)	—			—			1		(7		)	—			—			(6		)
Transfers	—			(4		)	—		—			—			(1		)	(5		)
Balance Dec 31, 2012	$	—		$	—		$	75	$	84		$	294		$	—		$	453

Cash Flows

The Company generally funds its pension and other postretirement benefit plans as required by law or to the extent such contributions are tax deductible. The Company expects to contribute approximately $132 million to its pension plans and $9 million to its other postretirement benefit plans in 2013.

The Company’s portion of the benefit payments that are expected to be paid during the years ending December 31 is as follows:

			Other Postretirement
In millions	Pension		Benefits
2013	$	213	$	38
2014	195		39
2015	174		39
2016	180		40
2017	188		41
Years 2018-2022	974		210

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Other Assets

12 Months Ended

Dec. 31, 2012

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Other Assets

Other Assets as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Cash surrender value of life insurance policies	$	391	$	371
Equity investment in Wilsonart	174		—
Customer tooling	107		81
Prepaid pension assets	57		41
Other	301		143
	$	1,030	$	636

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Goodwill and Intangible Assets Goodwill (Details 6) (Details)	12 Months Ended
	Dec. 31, 2012
Goodwill and Intangible Assets Disclosure [Abstract]
Number of Reportable Segments to Sr Management	40

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Accrued Expenses (Tables)

12 Months Ended

Dec. 31, 2012

Payables and Accruals [Abstract]

Accrued Expenses

Accrued Expenses as of December 31, 2012 and 2011 consisted of accruals for:

In millions	2012		2011
Compensation and employee benefits	$	529	$	551
Deferred revenue and customer deposits	243		245
Rebates	137		162
Warranties	51		55
Current portion of pension and other postretirement benefit obligations	19		28
Other	413		394
	$	1,392	$	1,435

Changes in Accrued Product Warranties

The changes in accrued warranties during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	55		$	64		$	62
Charges	(44		)	(47		)	(43		)
Provision charged to expense	44			37			45
Acquisitions and divestitures	(4		)	3			1
Foreign currency translation	—			—			(1		)
Transfer to liabilities held for sale	—			(2		)	—
Ending balance	$	51		$	55		$	64

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Other Income (Expense) (Tables)

12 Months Ended

Dec. 31, 2012

Other Income and Expenses [Abstract]

Other Income (Expense)

Other Income (Expense) consisted of the following:

In millions	2012			2011			2010
Interest income	$	40		$	40		$	24
Gain (loss) on disposal of operations and affiliates	22			2			(8		)
Income from investments	11			17			21
Gain (loss) on foreign currency transactions, net	(11		)	(4		)	(17		)
Equity loss in Wilsonart	(30		)	—			—
Other, net	5			(1		)	(10		)
	$	37		$	54		$	10

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Short-Term Debt

12 Months Ended

Dec. 31, 2012

Debt Disclosure [Abstract]

Short-Term Debt

Short-Term Debt as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Commercial paper	$	408	$	192
Bank overdrafts	40		38
Current maturities of long-term debt	6		262
Other borrowings	5		10
	$	459	$	502

The Company has committed credit facilities that support the issuance of commercial paper. See the Long-Term Debt note for further discussion. Commercial paper is stated at cost, which approximates fair value.

The weighted-average interest rate on commercial paper was 0.2% at December 31, 2012 and 0.1% at December 31, 2011. The weighted-average interest rate on other borrowings was 0.6% at December 31, 2012 and 11.2% at December 31, 2011.

As of December 31, 2012, the Company had unused capacity of approximately $248 million under international debt facilities.

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Accrued Expenses

12 Months Ended

Dec. 31, 2012

Payables and Accruals [Abstract]

Accrued Expenses

Accrued Expenses as of December 31, 2012 and 2011 consisted of accruals for:

In millions	2012		2011
Compensation and employee benefits	$	529	$	551
Deferred revenue and customer deposits	243		245
Rebates	137		162
Warranties	51		55
Current portion of pension and other postretirement benefit obligations	19		28
Other	413		394
	$	1,392	$	1,435

The Company accrues for product warranties based on historical experience. The changes in accrued warranties during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	55		$	64		$	62
Charges	(44		)	(47		)	(43		)
Provision charged to expense	44			37			45
Acquisitions and divestitures	(4		)	3			1
Foreign currency translation	—			—			(1		)
Transfer to liabilities held for sale	—			(2		)	—
Ending balance	$	51		$	55		$	64

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Notes to Financial Statements

12 Months Ended

Dec. 31, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of Operations

The Notes to Financial Statements furnish additional information on items in the financial statements. The notes have been arranged in the same order as the related items appear in the statements.

Illinois Tool Works Inc. (the “Company” or “ITW”) is a multinational manufacturer of a diversified range of industrial products and equipment with operations in 58 countries. The Company primarily serves the general industrial, automotive OEM/tiers, automotive aftermarket, construction, food and beverage, and food institutional/restaurant and service markets.

Significant accounting principles and policies of the Company are in italics. Certain reclassifications of prior years’ data have been made to conform to current year reporting.

The preparation of the Company’s financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the notes to financial statements. Actual results could differ from those estimates. The significant estimates included in the preparation of the financial statements are related to inventories, trade receivables, plant and equipment, income taxes, goodwill and intangible assets, product liability matters, litigation, product warranties, pensions, other postretirement benefits, environmental matters and stock based compensation.

On January 1, 2012, the Company adopted new accounting guidance that requires the presentation of net income and comprehensive income either in a single continuous financial statement or in two separate but consecutive financial statements. The Company is reporting comprehensive income in a separate consecutive financial statement for interim and annual reporting periods.

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Long-Term Debt

12 Months Ended

Dec. 31, 2012

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt at carrying value and fair value as of December 31, 2012 and 2011 consisted of the following:

	2012					2011
In millions	Carrying Value			Fair Value		Carrying Value			Fair Value
6.55% preferred debt securities due December 31, 2011	$	—		$	—	$	250		$	250
5.15% notes due April 1, 2014	800			846		800			877
5.25% Euro notes due October 1, 2014	989			1,071		971			1,064
6.25% notes due April 1, 2019	700			877		700			872
4.88% notes due thru December 31, 2020	12			13		22			24
3.375% notes due September 15, 2021	349			381		348			368
4.875% notes due September 15, 2041	641			770		641			761
3.9% notes due September 1, 2042	1,089			1,132		—			—
Other borrowings	15			15		18			18
	$	4,595		$	5,105	$	3,750		$	4,234
Current maturities	(6		)			(262		)
	$	4,589				$	3,488

The approximate fair values of the Company’s long-term debt, including current maturities, were based on a Level 2 valuation model, using observable inputs, which included market rates for comparable instruments as of December 31, 2012 and 2011.

In 2002, a subsidiary of the Company issued $250 million of 6.55% preferred debt securities at 99.849% of face value. The effective interest rate of the preferred debt securities was 6.7%. These preferred debt securities were due and fully paid on the first business day in 2012.

In 2005, the Company issued $54 million of 4.88% notes due through December 31, 2020 at 100% of face value.

In 2007, the Company, through a wholly-owned European subsidiary, issued €750 million of 5.25% Euro notes due October 1, 2014 at 99.874% of face value. The effective interest rate of the notes was 5.3%.

In 2009, the Company issued $800 million of 5.15% redeemable notes due April 1, 2014 at 99.92% of face value and $700 million of 6.25% redeemable notes due April 1, 2019 at 99.98% of face value. The effective interest rates of the notes were 5.2% and 6.3%, respectively.

In 2011, the Company issued $350 million of 3.375% notes due September 15, 2021 at 99.552% of face value and $650 million of 4.875% notes due September 15, 2041 at 98.539% of face value. The effective interest rates of the notes were 3.4% and 4.9%, respectively. These notes are senior unsecured obligations, ranking equal in right of payment with all other senior unsecured indebtedness of the Company.

In 2012, the Company issued $1.1 billion of 3.9% notes due September 1, 2042 at 99.038% of face value. The effective interest rate of the notes was 3.955%. These notes are senior unsecured obligations, ranking equal in right of payment with all other senior unsecured indebtedness of the Company.

Other debt outstanding at December 31, 2012 bears interest at rates ranging from 0.3% to 17.5%, with maturities through the year 2029.

On June 8, 2012, the Company entered into a $1.5 billion line of credit agreement with a termination date of June 8, 2017. In connection with the new line of credit, the Company terminated its $500 million revolving credit facility with a termination date of June 15, 2012 and its $1.0 billion line of credit agreement with a termination date of June 11, 2013. In 2010, the Company entered into a $1.0 billion line of credit agreement with a termination date of June 10, 2011, which was replaced in June of 2011 by a $1.0 billion line of credit with a termination date of June 10, 2016. These lines of credit support the issuance of commercial paper. No amounts were outstanding under either of the outstanding facilities at December 31, 2012.

The financial covenants in the Company's debt agreements limit total debt, including guarantees, to 50% of total capitalization. The Company’s total debt, including guarantees, was 34.3% of total capitalization as defined in the Company's debt agreements as of December 31, 2012, which was in compliance with these covenants.

Scheduled maturities of long-term debt for the future years ending December 31 are as follows:

In millions
2013	$	6
2014	1,793
2015	2
2016	1
2017	1
2018 and future years	2,792
	$	4,595

At December 31, 2012, the Company had open stand-by letters of credit of approximately $194 million, substantially all of which expire in 2013 and 2014.

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Income Per Share from Continuing Operations (Details) (USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Income from Continuing Operations
Income from continuing operations	$ 2,495	$ 2,017	$ 1,452
Income per share from continuing operations—Basic:
Weighted-average common shares	469,800,000	491,400,000	500,800,000
Income per share from continuing operations—Basic	$ 5.31	$ 4.10	$ 2.90
Income per share from continuing operations—Diluted:
Weighted-average common shares	469,800,000	491,400,000	500,800,000
Income per share from continuing operations—Diluted	$ 5.27	$ 4.08	$ 2.89
Income Per Share from Continuing Operations (Textual) [Abstract]
Antidilutive options outstanding	0.1	5.0	10.4

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Accrued Expenses (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Accrued Expenses
Compensation and employee benefits	$ 529	$ 551
Deferred revenue and customer deposits	243	245
Rebates	137	162
Warranties	51	55
Current portion of pension and other postretirement benefit obligations	19	28
Other	413	394
Accrued expenses	1,392	1,435
Changes in Accrued Product Warranties
Beginning balance	55	64	62
Charges	(44)	(47)	(43)
Provision charged to expense	44	37	45
Acquisitions and divestitures	(4)	3	1
Foreign currency translation	0	0	(1)
Transfer to liabilities held for sale	0	(2)	0
Ending balance	$ 51	$ 55	$ 64

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Divestiture of Majority Interest in Decorative Surfaces Segment (Tables)

12 Months Ended

Dec. 31, 2012

Equity Method Investments and Joint Ventures [Abstract]

Schedule of Historical Operating Results of Equity Investment

Historical operating results of Decorative Surfaces for 2012, 2011 and 2010 were as follows:

	For the Ten Months Ended October 31,		For the Twelve Months Ended December 31,
In millions	2012		2011		2010
Operating revenues	$	921	$	1,084	$	992
Operating income	122		132		117

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Other Assets (Tables)

12 Months Ended

Dec. 31, 2012

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Summary of Other assets

Other Assets as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Cash surrender value of life insurance policies	$	391	$	371
Equity investment in Wilsonart	174		—
Customer tooling	107		81
Prepaid pension assets	57		41
Other	301		143
	$	1,030	$	636

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Research and Development Expenses (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Research and Development Expenses (Textual) [Abstract]
Research and development expenses incurred	$ 266	$ 243	$ 213

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Statement of Income (USD $) In Millions, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Income Statement [Abstract]
Operating Revenues	$ 17,924	$ 17,787	$ 15,416
Cost of revenues	11,455	11,518	9,997
Selling, administrative, and research and development expenses	3,332	3,283	2,957
Amortization of intangible assets	288	255	207
Impairment of goodwill and other intangible assets	2	0	1
Operating Income	2,847	2,731	2,254
Interest expense	(214)	(192)	(175)
Gain on sale of interest in Decorative Surfaces	933	0	0
Other income (expense)	37	54	10
Income from Continuing Operations Before Income Taxes	3,603	2,593	2,089
Income taxes	1,108	576	637
Income from Continuing Operations	2,495	2,017	1,452
Income from Discontinued Operations	375	54	51
Net Income	$ 2,870	$ 2,071	$ 1,503
Income Per Share from Continuing Operations:
Basic	$ 5.31	$ 4.10	$ 2.90
Diluted	$ 5.27	$ 4.08	$ 2.89
Income Per Share from Discontinued Operations:
Basic	$ 0.80	$ 0.11	$ 0.10
Diluted	$ 0.79	$ 0.11	$ 0.10
Net Income Per Share:
Basic	$ 6.11	$ 4.21	$ 3.00
Diluted	$ 6.06	$ 4.19	$ 2.99

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Income Tax Disclosure [Abstract]

Components of provision for income taxes

The components of the provision for income taxes were as shown below:

In millions	2012			2011			2010
U.S. federal income taxes:
Current	$	566		$	515		$	397
Deferred	250			(34		)	(46		)
	816			481			351
Foreign income taxes:
Current	275			147			266
Deferred	(29		)	(82		)	(19		)
Benefit of net operating loss carryforwards	(30		)	(4		)	(3		)
	216			61			244
State income taxes:
Current	71			65			52
Deferred	5			(31		)	(3		)
Benefit of net operating loss carryforwards	—			—			(7		)
	76			34			42
	$	1,108		$	576		$	637

Income from continuing operations before income taxes

Income from continuing operations before income taxes for domestic and foreign operations was as follows:

In millions	2012		2011		2010
Domestic	$	2,471	$	1,452	$	1,217
Foreign	1,132		1,141		872
	$	3,603	$	2,593	$	2,089

Reconciliation between the U.S. Federal statutory tax rate and the effective tax rate

The reconciliation between the U.S. federal statutory tax rate and the effective tax rate was as follows:

	2012		2011		2010
U.S. federal statutory tax rate	35.0	%	35.0	%	35.0	%
State income taxes, net of U.S. federal tax benefit	0.9		1.1		1.2
Differences between U.S. federal statutory and foreign tax rates	(2.3	)	(2.7	)	(2.0	)
Nontaxable foreign interest income	(2.5	)	(3.6	)	(3.4	)
Australian court decision	—		(6.4	)	—
Tax effect of foreign dividends	0.6		0.4		0.5
Tax relief for U.S. manufacturers	(1.1	)	(1.3	)	(1.3	)
Other, net	0.1		(0.3	)	0.5
Effective tax rate	30.7	%	22.2	%	30.5	%

Components of deferred income tax assets and liabilities

The components of deferred income tax assets and liabilities at December 31, 2012 and 2011 were as follows:

	2012						2011
In millions	Asset			Liability			Asset			Liability
Goodwill and intangible assets	$	382		$	(901	)	$	355		$	(787	)
Inventory reserves, capitalized tax cost and LIFO inventory	68			(11		)	76			(13		)
Investments	37			(283		)	36			(56		)
Plant and equipment	14			(103		)	28			(107		)
Accrued expenses and reserves	58			—			79			—
Employee benefit accruals	362			—			351			—
Foreign tax credit carryforwards	31			—			12			—
Net operating loss carryforwards	709			—			623			—
Capital loss carryforwards	37			—			34			—
Allowances for uncollectible accounts	17			—			20			—
Pension liabilities	102			—			113			—
Deferred intercompany deductions	321			—			460			—
Other	122			(16		)	124			(21		)
Gross deferred income tax assets (liabilities)	2,260			(1,314		)	2,311			(984		)
Valuation allowances	(475		)	—			(449		)	—
Total deferred income tax assets (liabilities)	$	1,785		$	(1,314	)	$	1,862		$	(984	)

Net operating loss carryforwards

At December 31, 2012, the Company had net operating loss carryforwards available to offset future taxable income in the U.S. and certain foreign jurisdictions, which expire as follows:

In millions	Gross Carryforwards Related to Net Operating Losses
2013	$	5
2014	4
2015	4
2016	8
2017	17
2018	23
2019	24
2020	72
2021	74
2022	20
2023	14
2024	11
2025	10
2026	7
2027	13
2028	6
2029	7
2030	5
2031	1
2032	23
Do not expire	2,031
	$	2,379

Changes in amount of unrecognized tax benefits

The changes in the amount of unrecognized tax benefits during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	437		$	718		$	725
Additions based on tax positions related to the current year	32			43			57
Additions for tax positions of prior years	62			74			56
Reductions for tax positions of prior years	(163		)	(16		)	(96		)
Settlements	(125		)	(377		)	—
Foreign currency translation	6			(5		)	(24		)
Ending balance	$	249		$	437		$	718

Open Tax Years For Company's Major Jurisdictions

The following table summarizes the open tax years for the Company’s major jurisdictions:

Jurisdiction	Open Tax Years
United States – Federal	2004-2012
United Kingdom	2000-2012
Germany	2006-2012
France	2004-2012
Australia	2006-2012

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Goodwill and Intangible Assets (Details 2) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Carrying amount of goodwill by segment
Balance, beginning	$ 5,198	$ 4,972
Acquisitions & divestitures	284	464
Impairment charges	(1)	0	0
Foreign currency translation	49	(48)
Transfer to assets held for sale		(190)
Intersegment goodwill transfers	0	0
Balance, ending	5,530	5,198	4,972
Accumulated goodwill impairment charges, December 31, 2012	367
Transpor-tation
Carrying amount of goodwill by segment
Balance, beginning	677	567
Acquisitions & divestitures	8	118
Impairment charges	0	0
Foreign currency translation	11	(9)
Transfer to assets held for sale		0
Intersegment goodwill transfers	78	1
Balance, ending	774	677
Accumulated goodwill impairment charges, December 31, 2012	36
Power Systems & Electronics
Carrying amount of goodwill by segment
Balance, beginning	1,003	429
Acquisitions & divestitures	19	242
Impairment charges	(1)	0
Foreign currency translation	8	(3)
Transfer to assets held for sale		(7)
Intersegment goodwill transfers	53	342
Balance, ending	1,082	1,003
Accumulated goodwill impairment charges, December 31, 2012	89
Industrial Packaging
Carrying amount of goodwill by segment
Balance, beginning	783	769
Acquisitions & divestitures	(6)	25
Impairment charges	0	0
Foreign currency translation	10	(11)
Transfer to assets held for sale		0
Intersegment goodwill transfers	(52)	0
Balance, ending	735	783
Accumulated goodwill impairment charges, December 31, 2012	114
Food Equipment
Carrying amount of goodwill by segment
Balance, beginning	199	204
Acquisitions & divestitures	1	(1)
Impairment charges	0	0
Foreign currency translation	3	(4)
Transfer to assets held for sale		0
Intersegment goodwill transfers	0	0
Balance, ending	203	199
Accumulated goodwill impairment charges, December 31, 2012	60
Construction Products
Carrying amount of goodwill by segment
Balance, beginning	590	585
Acquisitions & divestitures	6	6
Impairment charges	0	0
Foreign currency translation	7	(1)
Transfer to assets held for sale		0
Intersegment goodwill transfers	0	0
Balance, ending	603	590
Accumulated goodwill impairment charges, December 31, 2012	7
Polymers & Fluids
Carrying amount of goodwill by segment
Balance, beginning	721	844
Acquisitions & divestitures	38	50
Impairment charges	0	0
Foreign currency translation	(2)	(17)
Transfer to assets held for sale		0
Intersegment goodwill transfers	(43)	(156)
Balance, ending	714	721
Accumulated goodwill impairment charges, December 31, 2012	15
Decorative Surfaces
Carrying amount of goodwill by segment
Balance, beginning	13	13
Acquisitions & divestitures	(13)	0
Impairment charges	0	0
Foreign currency translation	0	0
Transfer to assets held for sale		0
Intersegment goodwill transfers	0	0
Balance, ending	0	13
Accumulated goodwill impairment charges, December 31, 2012	0
All Other
Carrying amount of goodwill by segment
Balance, beginning	1,212	1,561
Acquisitions & divestitures	231	24
Impairment charges	0	0
Foreign currency translation	12	(3)
Transfer to assets held for sale		(183)
Intersegment goodwill transfers	(36)	(187)
Balance, ending	1,419	1,212
Accumulated goodwill impairment charges, December 31, 2012	$ 46

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Short-Term Debt (Details Textual) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Short-Term Debt (Textual) [Abstract]
Unused capacity under International debt facilities	248
Commercial Paper [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.20%	0.10%
Other Borrowings [Member]
Short-term Debt [Line Items]
Weighted-average interest rate	0.60%	11.20%

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Statement of Financial Position (Parenthetical)	Dec. 31, 2012	Dec. 31, 2011
Statement of Financial Position [Abstract]
Common stock shares issued	549,551,660	542,500,435

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Goodwill and Intangible Assets (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2010	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Goodwill [Abstract]
Impairment charges		$ 1	$ 0	$ 0
Intangible Assets:
Amortization		288	255	207
Impairment	0	1	0	1
Amortization and impairment of goodwill and other intangible assets		$ 290	$ 255	$ 208

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Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2012

Equity [Abstract]

Summary of Common Stock, Additional Paid-In-Capital and Common Stock Held in Treasury

	Common Stock			Additional Paid-In- Capital			Common Stock Held in Treasury
In millions	Shares	Amount		Amount			Shares		Amount
Balance, December 31, 2009	535.0	$	5	$	271		(32.7	)	$	(1,391	)
During 2010—
Shares issued for stock options	3.5	—		114			—		—
Shares issued for stock compensation and vesting of restricted stock	—	—		1			—		—
Stock compensation expense	—	—		56			—		—
Noncontrolling interest	—	—		—			—		—
Tax benefits related to stock options	—	—		16			—		—
Tax benefits related to defined contribution plans	—	—		3			—		—
Repurchases of common stock	—	—		—			(8.1	)	(350		)
Balance, December 31, 2010	538.5	5		461			(40.8	)	(1,741		)
During 2011—
Shares issued for stock options	3.9	—		151			—		—
Shares issued for stock compensation and vesting of restricted stock	0.1	—		2			—		(1		)
Stock compensation expense	—	—		56			—		—
Noncontrolling interest	—	—		—			—		—
Tax benefits related to stock options	—	—		13			—		—
Tax benefits related to defined contribution plans	—	—		3			—		—
Repurchases of common stock	—	—		—			(18.1	)	(950		)
Balance, December 31, 2011	542.5	5		686			(58.9	)	(2,692		)
During 2012—
Shares issued for stock options	6.3	—		285			—		—
Shares withheld for taxes	—	—		1			(0.3	)	(19		)
Shares issued for stock compensation and vesting of restricted stock	0.8	—		(10		)	0.2		9
Stock compensation expense	—	—		54			—		—
Noncontrolling interest	—	—		(22		)	—		—
Tax benefits related to stock options	—	—		14			—		—
Tax benefits related to defined contribution plans	—	—		4			—		—
Repurchases of common stock	—	—		—			(35.5	)	(2,020		)
Balance, December 31, 2012	549.6	$	5	$	1,012		(94.5	)	$	(4,722	)
Authorized, December 31, 2012	700.0

Changes in accumulated other comprehensive income

In millions	2012			2011			2010
Beginning balance	$	224		$	427		$	249
Foreign currency translation adjustments	94			(141		)	153
Pension and other postretirement benefits actuarial gains (losses), net of tax of $55 million in 2012, $54 million in 2011 and $(3) million in 2010	(104		)	(93		)	4
Amortization of unrecognized pension and other postretirement benefits costs, net of tax of $(22) million in 2012, $(17) million in 2011 and $(12) million in 2010	40			31			21
Pension and other postretirement benefits settlements, curtailments and other, net of tax of $(21) million in 2012	39			—			—
Ending balance	$	293		$	224		$	427

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Goodwill and Intangible Assets (Details Textual) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended								3 Months Ended	12 Months Ended		3 Months Ended	12 Months Ended
	Mar. 31, 2010	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2012 Segment, Discontinued Operations [Member]	Dec. 31, 2011 Segment, Discontinued Operations [Member]	Dec. 31, 2010 Segment, Discontinued Operations [Member]	Dec. 31, 2012 Minimum [Member]	Dec. 31, 2012 Maximum [Member]	Sep. 30, 2012 Pressure Sensitive Adhesives Reporting Unit [Member]	Dec. 31, 2012 Transportation Segment [Member]	Dec. 31, 2011 Transportation Segment [Member]	Sep. 30, 2012 Food Equipment [Member]	Dec. 31, 2012 Food Equipment [Member]	Dec. 31, 2011 Food Equipment [Member]	Dec. 31, 2012 All Other Segments [Member]	Dec. 31, 2011 All Other Segments [Member]
Goodwill and Intangible Assets [Line Items]
Amortization and impairment of goodwill and other intangible assets		$ 290	$ 255	$ 208
Indefinite Lived Intangible Assets (Textual) [Abstract]
Amortization of intangible assets		(288)	(255)	(207)	0	(3)	(6)
Impairment	0	1	0	1									0
Goodwill and Intangible Assets (Textual) [Abstract]
Estimated useful lives of amortized intangible assets								3 years	20 years
Goodwill, impairment charges		$ 1	$ 0	$ 0						$ 1	$ 0	$ 0		$ 0	$ 0	$ 0	$ 0

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Stockholders' Equity

12 Months Ended

Dec. 31, 2012

Equity [Abstract]

Stockholders' Equity

Preferred Stock, without par value, of which 0.3 million shares are authorized and unissued, is issuable in series. The Board of Directors is authorized to fix by resolution the designation and characteristics of each series of preferred stock. The Company has no present commitment to issue its preferred stock.

Common Stock, with a par value of $0.01, Additional Paid-In-Capital and Common Stock Held in Treasury transactions during 2012, 2011 and 2010 are shown below.

	Common Stock			Additional Paid-In- Capital			Common Stock Held in Treasury
In millions	Shares	Amount		Amount			Shares		Amount
Balance, December 31, 2009	535.0	$	5	$	271		(32.7	)	$	(1,391	)
During 2010—
Shares issued for stock options	3.5	—		114			—		—
Shares issued for stock compensation and vesting of restricted stock	—	—		1			—		—
Stock compensation expense	—	—		56			—		—
Noncontrolling interest	—	—		—			—		—
Tax benefits related to stock options	—	—		16			—		—
Tax benefits related to defined contribution plans	—	—		3			—		—
Repurchases of common stock	—	—		—			(8.1	)	(350		)
Balance, December 31, 2010	538.5	5		461			(40.8	)	(1,741		)
During 2011—
Shares issued for stock options	3.9	—		151			—		—
Shares issued for stock compensation and vesting of restricted stock	0.1	—		2			—		(1		)
Stock compensation expense	—	—		56			—		—
Noncontrolling interest	—	—		—			—		—
Tax benefits related to stock options	—	—		13			—		—
Tax benefits related to defined contribution plans	—	—		3			—		—
Repurchases of common stock	—	—		—			(18.1	)	(950		)
Balance, December 31, 2011	542.5	5		686			(58.9	)	(2,692		)
During 2012—
Shares issued for stock options	6.3	—		285			—		—
Shares withheld for taxes	—	—		1			(0.3	)	(19		)
Shares issued for stock compensation and vesting of restricted stock	0.8	—		(10		)	0.2		9
Stock compensation expense	—	—		54			—		—
Noncontrolling interest	—	—		(22		)	—		—
Tax benefits related to stock options	—	—		14			—		—
Tax benefits related to defined contribution plans	—	—		4			—		—
Repurchases of common stock	—	—		—			(35.5	)	(2,020		)
Balance, December 31, 2012	549.6	$	5	$	1,012		(94.5	)	$	(4,722	)
Authorized, December 31, 2012	700.0

On August 20, 2007, the Company’s Board of Directors authorized a stock repurchase program which provided for the buyback of up to $3.0 billion of the Company’s common stock over an open-ended period of time (the “2007 Program”). Under the 2007 Program, the Company made repurchases of 8.1 million shares of its common stock at an average price of $43.29 per share during 2010 and 16.3 million shares of its common stock at an average price of $53.51 per share during 2011. As of December 31, 2011, there were no authorized repurchases remaining under the 2007 Program.

On May 6, 2011, the Company’s Board of Directors authorized a new stock repurchase program which provides for the buyback of up to an additional $4.0 billion of the Company’s common stock over an open-ended period of time (the “2011 Program”). Under the 2011 Program, the Company made repurchases of 1.8 million shares of its common stock at an average price of $43.20 per share during 2011 and 35.5 million shares of its common stock at an average price of $56.93 per share during 2012. As of December 31, 2012, there was approximately $1.9 billion of authorized repurchases remaining under the 2011 Program.

Cash Dividends declared were $1.48 per share in 2012, $1.40 per share in 2011 and $1.30 per share in 2010. Cash dividends paid were $1.84 per share in 2012, which included an accelerated dividend payment of $0.38 per share in December 2012 which was originally scheduled to be paid in January 2013, $1.38 per share in 2011 and $1.27 per share in 2010.

Accumulated Other Comprehensive Income—The changes in accumulated other comprehensive income during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	224		$	427		$	249
Foreign currency translation adjustments	94			(141		)	153
Pension and other postretirement benefits actuarial gains (losses), net of tax of $55 million in 2012, $54 million in 2011 and $(3) million in 2010	(104		)	(93		)	4
Amortization of unrecognized pension and other postretirement benefits costs, net of tax of $(22) million in 2012, $(17) million in 2011 and $(12) million in 2010	40			31			21
Pension and other postretirement benefits settlements, curtailments and other, net of tax of $(21) million in 2012	39			—			—
Ending balance	$	293		$	224		$	427

Foreign currency translation adjustments for the year ended December 31, 2011 is net of a $55 million increase for the resolution of an issue with the Internal Revenue Service in the U.S. related to a deduction for foreign exchange losses on an intercompany loan.

As of December 31, 2012 and 2011, the ending balance of accumulated other comprehensive income consisted of cumulative translation adjustment income of $867 million and $773 million, respectively, and unrecognized pension and other postretirement benefits costs of $574 million and $549 million, respectively. The estimated unrecognized benefit cost that will be amortized from accumulated other comprehensive income into net periodic benefit cost in 2013 is $76 million for pension and $2 million for other postretirement benefits.

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Discontinued Operations (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Results of discontinued operations
Operating revenues	$ 142	$ 470	$ 433
Income before income taxes	488	82	85
Income tax expense	(113)	(28)	(34)
Income from discontinued operations	$ 375	$ 54	$ 51

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Trade Receivables

12 Months Ended

Dec. 31, 2012

Receivables [Abstract]

Trade Receivables

Trade Receivables were net of allowances for uncollectible accounts. The changes in the allowances for uncollectible accounts during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	(65	)	$	(70	)	$	(76	)
Provision charged to expense	(11		)	(5		)	(4		)
Write-offs, net of recoveries	14			10			12
Acquisitions and divestitures	—			(4		)	(3		)
Foreign currency translation	(1		)	2			1
Other	(2		)	2			—
Ending balance	$	(65	)	$	(65	)	$	(70	)

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Stock-Based Compensation

12 Months Ended

Dec. 31, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Stock-Based Compensation—Stock options and restricted stock units have been issued to officers and other management employees under ITW’s 2011 Long-Term Incentive Plan (the “Plan”). The stock options generally vest over a four-year period and have a maturity of ten years from the issuance date. Restricted stock units generally vest after a three-year period and include units with and without performance criteria. To cover the exercise of vested options and vesting of restricted stock units, the Company generally has issued new shares from its authorized but unissued share pool. At December 31, 2012, 43.6 million shares of ITW common stock were reserved for issuance under the Plan. The Company records compensation expense for the grant date fair value of stock awards over the remaining service periods of those awards.

The following summarizes the Company’s stock-based compensation expense:

In millions	2012			2011			2010
Pre-tax compensation expense	$	54		$	56		$	56
Tax benefit	(19		)	(17		)	(18		)
Total stock-based compensation recorded as expense, net of tax	$	35		$	39		$	38

The following table summarizes activity related to non-vested restricted stock units during 2012:

Shares in millions	Number of Shares		Weighted-Average Grant-Date Fair Value
Unvested, January 1, 2012	2.2		$39.27
Granted	0.5		51.39
Vested	(1.0	)	31.69
Canceled	(0.1	)	45.97
Unvested, December 31, 2012	1.6		47.36

The following table summarizes stock option activity under the Plan for the year ended December 31, 2012:

In millions except exercise price and contractual terms	Number of Shares		Weighted-Average Exercise Price	Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value
Under option, January 1, 2012	17.5		$46.57
Granted	1.8		55.72
Exercised	(6.3	)	45.23
Canceled or expired	(0.2	)	48.33
Under option, December 31, 2012	12.8		48.50	6.0 years	$157
Exercisable, December 31, 2012	9.5		47.49	5.3 years	$127

The Company's annual equity awards consist of stock options, restricted stock units (“RSUs”) and performance restricted stock units (“PRSUs”). The RSUs provide for full “cliff” vesting three years from the date of grant. The PRSUs provide for full “cliff” vesting after three years if the Compensation Committee certifies that the performance goals set with respect to the PRSUs have been met. Upon vesting, the holder will receive one share of common stock of the Company for each vested RSU or PRSU. Option exercise prices are equal to the common stock fair market value on the date of grant. The fair value of RSUs and PRSUs is determined by reducing the closing market price on the date of the grant by the present value of projected dividends over the vesting period. The Company uses a binomial option pricing model to estimate the fair value of the stock options granted. The following summarizes the assumptions used in the models:

	2012	2011	2010
Risk-free interest rate	0.2-2.1%	0.3-3.8%	0.4-3.9%
Weighted-average volatility	25.0%	25.0%	25.0%
Dividend yield	2.61%	2.80%	2.78%
Expected years until exercise	7.6-7.8	7.6-7.9	7.5-7.8

Lattice-based option valuation models, such as the binomial option pricing model, incorporate ranges of assumptions for inputs. The risk-free rate of interest for periods within the contractual life of the option is based on a zero-coupon U.S. government instrument over the contractual term of the equity instrument. Expected volatility is based on implied volatility from traded options on the Company’s stock and historical volatility of the Company’s stock. The Company uses historical data to estimate option exercise timing and employee termination rates within the valuation model. The weighted-average dividend yield is based on historical information. The expected term of options granted is derived from the output of the option valuation model and represents the period of time that options granted are expected to be outstanding. The ranges presented result from separate groups of employees assumed to exhibit different behavior.

The weighted-average grant-date fair value of options granted during 2012, 2011 and 2010 was $11.48, $12.34 and $9.59 per share, respectively. The aggregate intrinsic value of options exercised during the years ended December 31, 2012, 2011 and 2010 was $84 million, $63 million and $56 million, respectively. As of December 31, 2012 there was $20 million of total unrecognized compensation cost related to unvested stock options. That cost is expected to be recognized over a weighted-average period of 2.4 years. Exercise of options during the years ended December 31, 2012, 2011 and 2010 resulted in cash receipts of $285 million, $151 million and $114 million, respectively. The total fair value of vested stock option awards during the years ended December 31, 2012, 2011 and 2010 was $48 million, $33 million and $30 million, respectively.

As of December 31, 2012, there was $22 million of total unrecognized compensation cost related to unvested restricted stock units. That cost is expected to be recognized over a weighted-average remaining contractual life of 1.7 years. The total fair value of vested restricted stock unit awards during the years ended December 31, 2012 and 2011 was $31 million and $1 million, respectively.

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Goodwill and Intangible Assets (Details 4) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012
Estimated amortization expense of intangible assets
2013	$ 265
2014	249
2015	235
2016	221
2017	$ 201

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Stock-Based Compensation (Details 1) (USD $) In Millions, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012
Summary of activity related to non-vested restricted stock units
Number of Shares, Unvested, January 1, 2012	2.2
Number of Shares, Granted	0.5
Number of Shares, Vested	(1.0)
Number of Shares, Cancelled	(0.1)
Number of Shares, Unvested, December 31, 2012	1.6
Weighted-Average Grant-Date Fair Value, Unvested, January 1, 2012	$ 39.27
Weighted Average Grant Date Fair Value, Granted	$ 51.39
Weighted Average Grant Date Fair Value, Vested	$ 31.69
Weighted Average Grant Date Fair Value, Cancelled	$ 45.97
Weighted-Average Grant-Date Fair Value, Unvested, December 31, 2012	$ 47.36

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Prepaid Expenses and Other Current Assets

12 Months Ended

Dec. 31, 2012

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Prepaid Expenses and Other Current Assets

Prepaid Expenses and Other Current Assets as of December 31, 2012 and 2011 were as follows:

In millions	2012		2011
Income tax refunds receivable	$	231	$	112
Value-added-tax receivables	71		65
Vendor advances	52		40
Other	168		167
	$	522	$	384

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Acquisitions (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012 Acquisitions	Dec. 31, 2011 Acquisitions	Dec. 31, 2010 Acquisitions
Summarized information related to acquisitions
Number of acquisitions	23	28	24
Net cash paid during the year	$ 723	$ 1,308	$ 497

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Pension and Other Postretirement Benefits (Details 6) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	$ 2,288	$ 2,054	$ 1,941
Other Postretirement Benefits
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets		297	294
Pension Plan Assets, Total [Member] | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	2,288	2,054
Pension Plan Assets, Total [Member] | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	554	486
Pension Plan Assets, Total [Member] | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	1,575	1,407
Pension Plan Assets, Total [Member] | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	159	161
Cash and equivalents | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	26	17
Cash and equivalents | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	26	17
Cash and equivalents | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Cash and equivalents | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Cash and equivalents | Other Postretirement Benefits
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	34	34
Cash and equivalents | Other Postretirement Benefits | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	34	34
Cash and equivalents | Other Postretirement Benefits | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Cash and equivalents | Other Postretirement Benefits | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0
Domestic | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	56	56
Domestic | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	56	56
Domestic | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Domestic | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Foreign | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	85	68
Foreign | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	85	68
Foreign | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Foreign | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Government securities | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	245	218
Government securities | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Government securities | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	245	218
Government securities | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Corporate debt securities | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	263	244
Corporate debt securities | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Corporate debt securities | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	263	240
Corporate debt securities | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	4
Mortgage-backed securities | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	12	16
Mortgage-backed securities | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Mortgage-backed securities | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	12	16
Mortgage-backed securities | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Investment contracts with insurance companies | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	75	69
Investment contracts with insurance companies | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Investment contracts with insurance companies | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Investment contracts with insurance companies | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	75	69
Mutual funds | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	387	345
Mutual funds | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	387	345
Mutual funds | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Mutual funds | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Collective trust funds | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	1,055	932
Collective trust funds | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Collective trust funds | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	1,055	932
Collective trust funds | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Partnerships/private equity interests | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	84	87
Partnerships/private equity interests | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Partnerships/private equity interests | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Partnerships/private equity interests | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	84	87
Other [Member] | Pension
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets		2
Other [Member] | Pension | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets		0
Other [Member] | Pension | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets		1
Other [Member] | Pension | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets		1
Other Postretirement Benefit Plan Assets, Total | Other Postretirement Benefits
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	328	297
Other Postretirement Benefit Plan Assets, Total | Other Postretirement Benefits | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	34	34
Other Postretirement Benefit Plan Assets, Total | Other Postretirement Benefits | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Other Postretirement Benefit Plan Assets, Total | Other Postretirement Benefits | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	294	263
Life insurance policies | Other Postretirement Benefits
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	294	263
Life insurance policies | Other Postretirement Benefits | Level 1
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Life insurance policies | Other Postretirement Benefits | Level 2
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	0	0
Life insurance policies | Other Postretirement Benefits | Level 3
Defined benefit plan assets for plan benefits
Defined Benefit Plan, Fair Value of Plan Assets	$ 294	$ 263

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Statement of Cash Flows (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Cash Provided by (Used for) Operating Activities:
Net income	$ 2,870	$ 2,071	$ 1,503
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	323	336	335
Amortization and impairment of goodwill and other intangible assets	290	258	214
Change in deferred income taxes	243	(176)	(143)
Provision for uncollectible accounts	11	5	4
Income from investments	(11)	(17)	(21)
Gain on sale of plant and equipment	(4)	(2)	(1)
Gain (loss) on disposal of discontinued operations	(475)	4	(21)
(Gain) loss on disposal of operations and affiliates	(955)	(2)	8
Stock compensation expense	54	56	56
Other non-cash items, net	23	(6)	(2)
(Increase) decrease in—
Trade receivables	(13)	(303)	(170)
Inventories	82	(51)	(223)
Prepaid expenses and other assets	(75)	(50)	(39)
Increase (decrease) in—
Accounts payable	(21)	(55)	70
Accrued expenses and other liabilities	(87)	52	67
Income taxes receivable and payable	(173)	(182)	(149)
Other, net	(10)	18	0
Net cash provided by operating activities	2,072	1,956	1,488
Cash Provided by (Used for) Investing Activities:
Acquisition of businesses (excluding cash and equivalents) and additional interest in affiliates	(723)	(1,308)	(497)
Additions to plant and equipment	(382)	(353)	(288)
Purchases of investments	(1)	(6)	(16)
Proceeds from investments	281	37	27
Proceeds from sale of plant and equipment	30	17	18
Net proceeds from sale of discontinued operations	723	0	0
Proceeds from sale of operations and affiliates	1,120	22	63
Other, net	(1)	12	21
Net cash provided by (used for) investing activities	1,047	(1,579)	(672)
Cash Provided by (Used for) Financing Activities:
Cash dividends paid	(865)	(680)	(636)
Issuance of common stock	283	153	115
Repurchases of common stock	(2,020)	(950)	(350)
Net proceeds (repayments) of debt with original maturities of three months or less	208	167	(157)
Proceeds from debt with original maturities of more than three months	1,079	990	1
Repayments of debt with original maturities of more than three months	(272)	(9)	(34)
Excess tax benefits from share-based compensation	16	8	8
Net cash used for financing activities	(1,571)	(321)	(1,053)
Effect of Exchange Rate Changes on Cash and Equivalents	53	(64)	77
Cash and Equivalents:
Increase (decrease) during the year	1,601	(8)	(160)
Beginning of year	1,178	1,186	1,346
End of year	2,779	1,178	1,186
Supplementary Cash Flow Information:
Cash Paid During the Year for Interest	211	168	175
Cash Paid During the Year for Income Taxes, Net of Refunds	1,134	978	960
Supplementary Non-Cash Investing Information:
Liabilities Assumed from Acquisitions	194	200	216
Equity investment in Wilsonart	$ 204	$ 0	$ 0

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Statement of Comprehensive Income (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Statement of Other Comprehensive Income [Abstract]
Net income	$ 2,870	$ 2,071	$ 1,503
Other Comprehensive Income:
Foreign currency translation adjustments	94	(141)	153
Pension and other postretirement benefit adjustments, net of tax	(25)	(62)	25
Comprehensive Income	$ 2,939	$ 1,868	$ 1,681

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Advertising Expenses

12 Months Ended

Dec. 31, 2012

Advertising Expenses [Abstract]

Advertising Expenses

Advertising Expensesare recorded as expense in the year incurred. These costs were $84 million in 2012, $88 million in 2011 and $72 million in 2010.

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Pension and Other Postretirement Benefits (Details 1) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Pension
Change in benefit obligation:
Benefit obligation at January 1	$ 2,465	$ 2,301
Service cost	100	94	94
Interest cost	107	116	110
Plan participants’ contributions	6	8
Amendments	5	0
Actuarial loss	204	79
Acquisitions/divestitures	(74)	16
Benefits paid	(196)	(142)
Medicare subsidy received	0	0
Liabilities from (to) other immaterial plans	0	2
Settlement/curtailment loss (gain)	5	0
Foreign currency translation	33	(9)
Benefit obligation at December 31	2,655	2,465	2,301
Other Postretirement Benefits
Change in benefit obligation:
Benefit obligation at January 1	569	559
Service cost	13	14	14
Interest cost	27	30	30
Plan participants’ contributions	15	15
Amendments	0	0
Actuarial loss	45	0
Acquisitions/divestitures	0	0
Benefits paid	(45)	(48)
Medicare subsidy received	3	3
Liabilities from (to) other immaterial plans	0	(4)
Settlement/curtailment loss (gain)	(38)	0
Foreign currency translation	0	0
Benefit obligation at December 31	$ 589	$ 569	$ 559

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Investments (Details Textual) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Investments Disclosure [Abstract]
Percentage of interest in venture capital limited partnership	25.00%
Percentage of interest in partnership with a residential construction developer	50.00%
Deferred tax liabilities related to leases of equipment	$ 38	$ 54
Proceeds from Termination of Leveraged Leases	231
Income from leveraged leases	5	13	11
Loss on termination of leveraged lease transaction	$ 8

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Investments (Details 1) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Leveraged and direct financing leases:
Gross lease contracts receivable, net of nonrecourse debt service	$ 0	$ 130
Estimated residual value of leased assets	28	248
Unearned income	(1)	(110)
Total leveraged and direct financing leases	27	268
Equipment under operating leases	6	7
Total investment in leases of equipment	$ 33	$ 275

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Stock-Based Compensation (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Summary of stock-based compensation expense
Pre-tax compensation expense	$ 54	$ 56	$ 56
Tax benefit	(19)	(17)	(18)
Total stock-based compensation recorded as expense, net of tax	$ 35	$ 39	$ 38

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Stockholders' Equity (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Summary of Common Stock, Additional Paid in Capital and Common Stock Held in Treasury
Shares issued for stock options, shares	6.3
Common Stock [Member]
Summary of Common Stock, Additional Paid in Capital and Common Stock Held in Treasury
Beginning Balance, shares	542.5	538.5	535.0
Beginning Balance, amount	$ 5	$ 5	$ 5
Shares issued for stock options, shares	6.3	3.9	3.5
Shares issued for stock options, amount	0	0	0
Shares Paid for Tax Withholding for Share Based Compensation	0
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures	0	0	0
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures	0	0	0
Noncontrolling Interest, Stockholders' Equity, Shares	0	0	0
Noncontrolling Interest, Stockholders' Equity, Value	0	0	0
Adjustments to Additional Paid in Capital, Income Tax Benefits from Share-Based Compensation, Shares	0	0	0
Shares issued for stock compensation and vesting of restricted stock, amount	0	0	0
Stock Issued During Period, Shares, Stock Compensation and Vesting of Restricted Stock	0.8	0.1	0
Tax benefits related to stock options	0	0	0
Adjustments to Additional Paid in Capital Tax Effect from Defined Contribution Plans, Shares	0	0	0
Tax benefits related to defined contribution plans	0	0	0
Repurchases of common stock, shares	0	0	0
Repurchases of common stock, amount	0	0	0
Ending Balance, shares	(549.6)	(542.5)	(538.5)
Ending Balance, amount	(5)	(5)	(5)
Authorized Ending Balance	700
Additional Paid-in Capital [Member]
Summary of Common Stock, Additional Paid in Capital and Common Stock Held in Treasury
Beginning Balance, amount	686	461	271
Shares issued for stock options, amount	285.0	151.0	114.0
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures	54	56	56
Noncontrolling Interest, Stockholders' Equity, Value	-22	0	0
Shares issued for stock compensation and vesting of restricted stock, amount	(10)	2	1
Shares Withheld for Taxes, Value	1
Tax benefits related to stock options	14	13	16
Tax benefits related to defined contribution plans	4	3	3
Repurchases of common stock, amount	0	0	0
Ending Balance, amount	(1,012)	(686)	(461)
Common Stock Held in Treasury [Member]
Summary of Common Stock, Additional Paid in Capital and Common Stock Held in Treasury
Beginning Balance, shares	58.9	40.8	32.7
Beginning Balance, amount	(2,692)	(1,741)	(1,391)
Shares issued for stock options, shares	0	0	0
Shares issued for stock options, amount	0	0	0
Shares Paid for Tax Withholding for Share Based Compensation	0
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures	0	0	0
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures	0	0	0
Noncontrolling Interest, Stockholders' Equity, Shares	0	0	0
Noncontrolling Interest, Stockholders' Equity, Value	0	0	0
Adjustments to Additional Paid in Capital, Income Tax Benefits from Share-Based Compensation, Shares	0	0	0
Shares issued for stock compensation and vesting of restricted stock, amount	9	(1)	0
Shares Withheld for Taxes, Value	-19
Stock Issued During Period, Shares, Stock Compensation and Vesting of Restricted Stock	.2	0	0
Tax benefits related to stock options	0	0	0
Adjustments to Additional Paid in Capital Tax Effect from Defined Contribution Plans, Shares	0	0	0
Tax benefits related to defined contribution plans	0	0	0
Repurchases of common stock, shares	(35.5)	(18.1)	(8.1)
Repurchases of common stock, amount	(2,020)	(950)	(350)
Ending Balance, shares	(95.0)	(58.9)	(40.8)
Ending Balance, amount	$ 4,722	$ 2,692	$ 1,741

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Document and Entity Information (USD $) In Billions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Jan. 31, 2013	Jun. 30, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	ILLINOIS TOOL WORKS INC
Entity Central Index Key	0000049826
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-K
Document Period End Date	Dec. 31, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Common Stock, Shares Outstanding		451,435,783
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float			$ 20.6

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Stock-Based Compensation (Details 3)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2013 Minimum [Member]	Dec. 31, 2012 Minimum [Member]	Dec. 31, 2010 Minimum [Member]	Dec. 31, 2013 Maximum [Member]	Dec. 31, 2012 Maximum [Member]	Dec. 31, 2010 Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-Free Interest Rate, Stock-Based Compensation	0.2-2.1%	0.3-3.8%	0.4-3.9%
Summary of assumptions used in option models
Risk-free interest rate, minimum	0.20%	0.30%	0.40%
Risk-free interest rate, maximum	2.10%	3.80%	3.90%
Weighted-average volatility	25.00%	25.00%	25.00%
Dividend yield	2.61%	2.80%	2.78%
Expected years until exercise				7 years 7 months 6 days	7 years 7 months 6 days	7 years 6 months	7 years 9 months 18 days	7 years 10 months 24 days	7 years 9 months 18 days
Expected Years Until Exercise, Stock-Based Compensation	7.6-7.8	7.6-7.9	7.5-7.8

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Other Income (Expense)

12 Months Ended

Dec. 31, 2012

Other Income and Expenses [Abstract]

Other Income (Expense)

Other Income (Expense) consisted of the following:

In millions	2012			2011			2010
Interest income	$	40		$	40		$	24
Gain (loss) on disposal of operations and affiliates	22			2			(8		)
Income from investments	11			17			21
Gain (loss) on foreign currency transactions, net	(11		)	(4		)	(17		)
Equity loss in Wilsonart	(30		)	—			—
Other, net	5			(1		)	(10		)
	$	37		$	54		$	10

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Income Taxes (Details 4) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Changes in the amount of unrecognized tax benefits
Beginning balance	$ 437	$ 718	$ 725
Additions based on tax positions related to the current year	32	43	57
Additions for tax positions of prior years	62	74	56
Reductions for tax positions of prior years	(163)	(16)	(96)
Settlements	(125)	(377)	0
Foreign currency translation	6	(5)	(24)
Ending balance	$ 249	$ 437	$ 718

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Investments (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Investments [Line Items]
Leases of equipment	$ 146	$ 409
Leases of Equipment [Member]
Investments [Line Items]
Leases of equipment	33	275
Venture capital limited partnership
Investments [Line Items]
Leases of equipment	36	43
Properties held for sale
Investments [Line Items]
Leases of equipment	39	42
Property developments
Investments [Line Items]
Leases of equipment	26	26
Affordable housing limited partnerships
Investments [Line Items]
Leases of equipment	$ 12	$ 23

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Statement of Income Reinvested in the Business (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Statement of Income Reinvested in Business [Roll Forward]
Beginning Balance	$ 11,794	$ 10,408	$ 9,555
Net income	2,870	2,071	1,503
Cash dividends declared	(691)	(685)	(650)
Ending Balance	$ 13,973	$ 11,794	$ 10,408

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Discontinued Operations

12 Months Ended

Dec. 31, 2012

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations—The Company periodically reviews its operations for businesses which may no longer be aligned with its long-term objectives. In April 2011, the Company entered into a definitive agreement to sell its finishing group of businesses included within the All Other segment to Graco Inc. in a $650 million cash transaction. The sale of the finishing business to Graco was completed on April 2, 2012. The finishing business was classified as held for sale beginning in the second quarter of 2011.

In the second quarter of 2011, the Company’s Board of Directors approved plans to divest a consumer packaging business in the All Other segment and an electronics components business in the Power Systems & Electronics segment. The consumer packaging and electronics components businesses were classified as held for sale beginning in the second quarter of 2011. The electronics components business was sold in the fourth quarter of 2011. The consumer packaging business was sold in the third quarter of 2012. The Company exited a flooring business in the Decorative Surfaces segment in early 2011 and sold a security printing business in the All Other segment in the third quarter of 2010.

The consolidated statement of income and the notes to financial statements were restated to present the operating results of the held for sale and previously divested or exited businesses discussed above as discontinued operations for 2012, 2011 and 2010.

Results of the discontinued operations for the years ended December 31, 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Operating revenues	$	142		$	470		$	433
Income before income taxes	$	488		$	82		$	85
Income tax expense	(113		)	(28		)	(34		)
Income from discontinued operations	$	375		$	54		$	51

Income before income taxes from discontinued operations in 2012 included a $452 million gain ($372 million after-tax) related to the sale of the finishing business and a $24 million gain ($3 million after-tax) related to the sale of the consumer packaging business. Income before income taxes from discontinued operations included a $4 million loss ($3 million loss after-tax) related to the sale of the electronics components business in 2011 and a $20 million gain ($5 million after-tax) related to the sale of the security printing business in 2010.

The assets and liabilities of the divested businesses discussed above were presented as assets and liabilities held for sale in the statement of financial position. There were no businesses classified as held for sale at December 31, 2012. Assets and liabilities held for sale at December 31, 2011 included both the consumer packaging and finishing businesses discussed above. The following table summarizes the classes of assets and liabilities held for sale at December 31, 2011:

In millions	December 31, 2011
Trade receivables	$	72
Inventories	56
Net plant and equipment	44
Goodwill and intangible assets	201
Other	13
Total assets held for sale	$	386
Accounts payable	$	22
Accrued expenses	55
Other	30
Total liabilities held for sale	$	107

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Divestiture of Majority Interest in Decorative Surfaces Segment

12 Months Ended

Dec. 31, 2012

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments and Joint Ventures Disclosure

Divestiture of Majority Interest in Decorative Surfaces Segment—On August 15, 2012, the Company entered into a definitive agreement (the “Investment Agreement”) to divest a 51% majority interest in its Decorative Surfaces segment to certain funds managed by Clayton, Dubilier & Rice, LLC (“CD&R”). The transaction closed on October 31, 2012 resulting in a pre-tax gain of $933 million ($632 million after-tax) in the fourth quarter of 2012.

Under the terms of the Investment Agreement, the Company contributed the assets and stock of the Decorative Surfaces segment to a newly formed joint venture, Wilsonart International Holdings LLC (“Wilsonart”). Through a combination of CD&R's equity investment in Wilsonart and new third party borrowings by a subsidiary of Wilsonart, the Company and its subsidiaries received payments of approximately $1.05 billion from Wilsonart and its subsidiaries as well as common units (the “Common Units”) initially representing approximately 49% (on an as-converted basis) of the total outstanding equity of Wilsonart immediately following the closing of the transaction. CD&R contributed $395 million to Wilsonart in exchange for newly issued cumulative convertible participating preferred units (the “Preferred Units”) of Wilsonart initially representing approximately 51% (on an as-converted basis) of the total outstanding equity immediately following the closing of the transaction. The Preferred Units rank senior to the Common Units as to dividends and liquidation preference. The Preferred Units have an initial liquidation preference of $395 million and accrue dividends at a rate of 10.00% per annum payable in cash or in additional Preferred Units at the option of Wilsonart. In the event the amount of dividends paid in additional Preferred Units exceeds certain thresholds, the dividends may accumulate as cash dividends to be paid at a later date, in which case the dividend rate will increase to 12.00% per annum.  Dividend payments on the Preferred Units may be eliminated if Wilsonart achieves certain performance targets for three twelve-month periods. Under the terms of the Investment Agreement, Wilsonart incurred new third party indebtedness of approximately $725 million.

As of October 31, 2012, the Company ceased consolidating the results of the Decorative Surfaces segment and now reports its ownership interest in Wilsonart using the equity method of accounting. The Company recorded its initial equity investment in Wilsonart at fair value. The fair value was determined using an implied equity value approach, which is a Level 3 valuation method. Under this approach, the total equity of Wilsonart was valued using an option pricing model and the value of the Preferred Units was deducted to arrive at the implied equity value of the Common Units. The significant unobservable inputs utilized in this calculation were the expected term of the investment and assumed volatility during the term. The Company also applied a discount factor to the implied equity value of the Common Units due to the lack of marketability of the Common Units. The fair value of the Company's retained ownership interest was determined to be $204 million and resulted in a pre-tax gain of $51 million related to the retained interest which was included in the pre-tax gain noted above. The Company's equity investment in Wilsonart is reported in Other assets in the consolidated statement of financial position. The Company's proportionate share in the income (loss) of Wilsonart is reported in Other income (expense) in the consolidated statement of income. As the Company's investment in Wilsonart is structured as a partnership for U.S. tax purposes, U.S. taxes are recorded separately from the equity investment. For the two month period ended December 31, 2012, the Company recorded a loss of $30 million in Other income(expense) related to its interest in Wilsonart. Wilsonart's loss for the two month period was primarily due to transaction costs related to the formation of Wilsonart and the impact of purchase accounting.

Due to the Company's continuing involvement through its 49% interest in Wilsonart, the historical operating results of Decorative Surfaces are presented in continuing operations. Additionally, as of November 1, 2012, the operating results of Decorative Surfaces are no longer reviewed by senior management of the Company and therefore Decorative Surfaces is no longer a reportable segment of the Company.

Historical operating results of Decorative Surfaces for 2012, 2011 and 2010 were as follows:

	For the Ten Months Ended October 31,		For the Twelve Months Ended December 31,
In millions	2012		2011		2010
Operating revenues	$	921	$	1,084	$	992
Operating income	122		132		117

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Inventories

12 Months Ended

Dec. 31, 2012

Inventory Disclosure [Abstract]

Inventories

Inventories at December 31, 2012 and 2011 were as follows:

In millions	2012		2011
Raw material	$	539	$	596
Work-in-process	152		156
Finished goods	894		964
	$	1,585	$	1,716

Inventories are stated at the lower of cost or market and include material, labor and factory overhead. The last-in, first-out (“LIFO”) method is used to determine the cost of the inventories of approximately 44% of the U.S. inventories. Inventories priced at LIFO were approximately 21% and 22% of total inventories as of December 31, 2012 and 2011, respectively. The first-in, first-out (“FIFO”) method, which approximates current cost, is used for all other inventories. If the FIFO method was used for all inventories, total inventories would have been approximately $101 million and $128 million higher than reported at December 31, 2012 and 2011, respectively.

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Income Taxes

12 Months Ended

Dec. 31, 2012

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes—The Company utilizes the asset and liability method of accounting for income taxes. Deferred income taxes are determined based on the estimated future tax effects of differences between the financial and tax bases of assets and liabilities given the provisions of the enacted tax laws. The components of the provision for income taxes were as shown below:

In millions	2012			2011			2010
U.S. federal income taxes:
Current	$	566		$	515		$	397
Deferred	250			(34		)	(46		)
	816			481			351
Foreign income taxes:
Current	275			147			266
Deferred	(29		)	(82		)	(19		)
Benefit of net operating loss carryforwards	(30		)	(4		)	(3		)
	216			61			244
State income taxes:
Current	71			65			52
Deferred	5			(31		)	(3		)
Benefit of net operating loss carryforwards	—			—			(7		)
	76			34			42
	$	1,108		$	576		$	637

Income from continuing operations before income taxes for domestic and foreign operations was as follows:

In millions	2012		2011		2010
Domestic	$	2,471	$	1,452	$	1,217
Foreign	1,132		1,141		872
	$	3,603	$	2,593	$	2,089

The reconciliation between the U.S. federal statutory tax rate and the effective tax rate was as follows:

	2012		2011		2010
U.S. federal statutory tax rate	35.0	%	35.0	%	35.0	%
State income taxes, net of U.S. federal tax benefit	0.9		1.1		1.2
Differences between U.S. federal statutory and foreign tax rates	(2.3	)	(2.7	)	(2.0	)
Nontaxable foreign interest income	(2.5	)	(3.6	)	(3.4	)
Australian court decision	—		(6.4	)	—
Tax effect of foreign dividends	0.6		0.4		0.5
Tax relief for U.S. manufacturers	(1.1	)	(1.3	)	(1.3	)
Other, net	0.1		(0.3	)	0.5
Effective tax rate	30.7	%	22.2	%	30.5	%

Deferred U.S. federal income taxes and foreign withholding taxes have not been provided on the remaining undistributed earnings of certain international subsidiaries as these earnings are considered permanently invested. Undistributed earnings of these subsidiaries were approximately $8.3 billion and $6.3 billion as of December 31, 2012 and 2011, respectively. Upon repatriation of these earnings to the U.S. in the form of dividends or otherwise, the Company may be subject to U.S. income taxes and foreign withholding taxes. The actual U.S. tax cost would depend on income tax laws and circumstances at the time of distribution. Determination of the related tax liability is not practicable because of the complexities associated with the hypothetical calculation.

The components of deferred income tax assets and liabilities at December 31, 2012 and 2011 were as follows:

	2012						2011
In millions	Asset			Liability			Asset			Liability
Goodwill and intangible assets	$	382		$	(901	)	$	355		$	(787	)
Inventory reserves, capitalized tax cost and LIFO inventory	68			(11		)	76			(13		)
Investments	37			(283		)	36			(56		)
Plant and equipment	14			(103		)	28			(107		)
Accrued expenses and reserves	58			—			79			—
Employee benefit accruals	362			—			351			—
Foreign tax credit carryforwards	31			—			12			—
Net operating loss carryforwards	709			—			623			—
Capital loss carryforwards	37			—			34			—
Allowances for uncollectible accounts	17			—			20			—
Pension liabilities	102			—			113			—
Deferred intercompany deductions	321			—			460			—
Other	122			(16		)	124			(21		)
Gross deferred income tax assets (liabilities)	2,260			(1,314		)	2,311			(984		)
Valuation allowances	(475		)	—			(449		)	—
Total deferred income tax assets (liabilities)	$	1,785		$	(1,314	)	$	1,862		$	(984	)

Valuation allowances are established when it is estimated that it is more likely than not that the tax benefit of the deferred tax asset will not be realized. The valuation allowances recorded at December 31, 2012 and 2011 relate primarily to certain net operating loss carryforwards and capital loss carryforwards.

At December 31, 2012, the Company had net operating loss carryforwards available to offset future taxable income in the U.S. and certain foreign jurisdictions, which expire as follows:

In millions	Gross Carryforwards Related to Net Operating Losses
2013	$	5
2014	4
2015	4
2016	8
2017	17
2018	23
2019	24
2020	72
2021	74
2022	20
2023	14
2024	11
2025	10
2026	7
2027	13
2028	6
2029	7
2030	5
2031	1
2032	23
Do not expire	2,031
	$	2,379

The Company has foreign tax credit carryforwards of $31 million as of December 31, 2012 that are available for use by the Company between 2013 and 2022.

The changes in the amount of unrecognized tax benefits during 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Beginning balance	$	437		$	718		$	725
Additions based on tax positions related to the current year	32			43			57
Additions for tax positions of prior years	62			74			56
Reductions for tax positions of prior years	(163		)	(16		)	(96		)
Settlements	(125		)	(377		)	—
Foreign currency translation	6			(5		)	(24		)
Ending balance	$	249		$	437		$	718

Included in the balance at December 31, 2012 are approximately $249 million of tax positions that, if recognized, would impact the Company’s effective tax rate.

During the fourth quarter of 2012, the Company came to an agreement with the Internal Revenue Service on issues related predominately to intercompany transactions and global legal structure reorganization transactions identified by the Internal Revenue Service during its 2008-2009 audit. Based on this agreement, the Company decreased its unrecognized tax benefits related to this matter by approximately $125 million and recorded an unfavorable discrete tax charge of $35 million.

The Company litigated a dispute with the Australian Tax Office over the tax treatment of an intercompany financing transaction between the U.S. and Australia. The case was heard before the Federal Court of Australia, Victoria, in September 2010. The proceedings resulted from the Company’s appeal of a decision by the Australian Tax Commissioner to disallow income tax deductions for the income tax years 2002 through 2005 and the assessment of withholding taxes for income tax year 2003. The Company also contested the Commissioner’s similar determination for income tax years 2006 and 2007; however, the parties agreed to follow the Court’s decision made on the earlier years. On February 4, 2011, the Federal Court of Australia, Victoria, decided in the Company’s favor with respect to a significant portion of the income tax deductions. The Court issued the final orders on February 18, 2011. Based on this decision, the Company decreased its unrecognized tax benefits related to this matter by approximately $197 million and recorded a favorable discrete non-cash tax benefit to reduce tax expense by $166 million in the first quarter of 2011. Subsequent to the 2011 ruling, the Australian Tax Office appealed the timing of certain of the deductions. In March 2012, the Court ruled in favor of the Australian Tax Office regarding the timing of the deductions, which did not have a material impact to the Company.

During the first quarter of 2011, the Company resolved an issue with the Internal Revenue Service in the U.S. related to a deduction for foreign exchange losses on an intercompany loan that resulted in a decrease in unrecognized tax benefits of approximately $179 million.

In March 2010, the Patient Protection and Affordable Care Act and Health Care and Education Reconciliation Act were signed into law. As a result, future tax deductions for retiree prescription drug coverage will be reduced by the amount of subsidies received starting in 2013. In the first quarter of 2010, the Company recorded a discrete tax charge of $22 million for the impact of the health care reform legislation.

The Company and its subsidiaries file tax returns in the U.S. and various state, local and foreign jurisdictions. These tax returns are routinely audited by the tax authorities in these jurisdictions including the Internal Revenue Service, Her Majesty's Revenue and Customs, German Fiscal Authority, French Fiscal Authority, and Australian Tax Office, and a number of these audits are currently ongoing, which may increase the amount of the unrecognized tax benefits in future periods. Due to the ongoing audits, the Company believes it is reasonably possible that within the next twelve months the amount of the Company's unrecognized tax benefits may be decreased by approximately $39 million related predominantly to various intercompany transactions. The Company has recorded its best estimate of the potential exposure for these issues. The following table summarizes the open tax years for the Company’s major jurisdictions:

Jurisdiction	Open Tax Years
United States – Federal	2004-2012
United Kingdom	2000-2012
Germany	2006-2012
France	2004-2012
Australia	2006-2012

The Company recognizes interest and penalties related to income tax matters in income tax expense. The accrual for interest and penalties as of December 31, 2012 and 2011 was $16 million and $2 million, respectively.

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Cash and Equivalents (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Cash and Equivalents (Textual) [Abstract]
Interest-bearing instruments	$ 1,000	$ 551
Maturity period of interest-bearing instruments	90 days or less

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Research and Development Expenses

12 Months Ended

Dec. 31, 2012

Research and Development [Abstract]

Research and Development Expenses

Research and Development Expensesare recorded as expense in the year incurred. These costs were $266 million in 2012, $243 million in 2011 and $213 million in 2010.

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Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of stock based compensation expense

The following summarizes the Company’s stock-based compensation expense:

In millions	2012			2011			2010
Pre-tax compensation expense	$	54		$	56		$	56
Tax benefit	(19		)	(17		)	(18		)
Total stock-based compensation recorded as expense, net of tax	$	35		$	39		$	38

Summary of activity related to non vested equity awards

The following table summarizes activity related to non-vested restricted stock units during 2012:

Shares in millions	Number of Shares		Weighted-Average Grant-Date Fair Value
Unvested, January 1, 2012	2.2		$39.27
Granted	0.5		51.39
Vested	(1.0	)	31.69
Canceled	(0.1	)	45.97
Unvested, December 31, 2012	1.6		47.36

Summary of stock option activity under plan

The following table summarizes stock option activity under the Plan for the year ended December 31, 2012:

In millions except exercise price and contractual terms	Number of Shares		Weighted-Average Exercise Price	Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value
Under option, January 1, 2012	17.5		$46.57
Granted	1.8		55.72
Exercised	(6.3	)	45.23
Canceled or expired	(0.2	)	48.33
Under option, December 31, 2012	12.8		48.50	6.0 years	$157
Exercisable, December 31, 2012	9.5		47.49	5.3 years	$127

Summary of assumptions used in option models

The Company uses a binomial option pricing model to estimate the fair value of the stock options granted. The following summarizes the assumptions used in the models:

	2012	2011	2010
Risk-free interest rate	0.2-2.1%	0.3-3.8%	0.4-3.9%
Weighted-average volatility	25.0%	25.0%	25.0%
Dividend yield	2.61%	2.80%	2.78%
Expected years until exercise	7.6-7.8	7.6-7.9	7.5-7.8

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Pension and Other Postretirement Benefits (Details 8) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012
Pension
Portion of the benefit payments are expected to be paid
2013	$ 213
2014	195
2015	174
2016	180
2017	188
Years 2018-2022	974
Other Postretirement Benefits
Portion of the benefit payments are expected to be paid
2013	38
2014	39
2015	39
2016	40
2017	41
Years 2018-2022	$ 210

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Acquisitions

12 Months Ended

Dec. 31, 2012

Business Combinations [Abstract]

Acquisitions

Acquisitions—The Company accounts for acquisitions under the acquisition method, in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition. The operating results of the acquired companies are included in the Company’s consolidated financial statements from the date of acquisition. Acquisitions, individually and in the aggregate, did not materially affect the Company’s results of operations or financial position for any period presented. Summarized information related to acquisitions is as follows:

In millions except number of acquisitions	2012		2011		2010
Number of acquisitions	23		28		24
Net cash paid during the year	$	723	$	1,308	$	497

The premium over tangible net assets recorded for acquisitions based on purchase price allocations during 2012, 2011 and 2010 was as follows:

	2012			2011			2010
In millions except weighted-average lives (years)	Weighted- Average Life	Premium Recorded		Weighted- Average Life	Premium Recorded		Weighted- Average Life	Premium Recorded
Goodwill		$	333		$	476		$	219
Amortizable intangible assets:
Customer lists and relationships	12.2	169		12.2	362		11.8	121
Patents and proprietary technology	8.2	38		9.6	98		10.9	32
Trademarks and brands	12.8	36		17.3	245		14.9	71
Noncompete agreements	4.5	29		5.0	27		5.3	5
Other	7.2	12		1.8	11		4.9	12
Total amortizable intangible assets	10.7	284		13.1	743		12.1	241
Indefinite-lived intangible assets:
Trademarks and brands		42			5			—
Total premium recorded		$	659		$	1,224		$	460

Of the total goodwill recorded for acquisitions, the Company expects goodwill of $15 million in 2012, $302 million in 2011 and $51 million in 2010 will be tax deductible.

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Operating Revenues

12 Months Ended

Dec. 31, 2012

Operating Revenues [Abstract]

Operating Revenues

Operating Revenuesare recognized when persuasive evidence of an arrangement exists, product has shipped and the risks and rewards of ownership have transferred or services have been rendered, the price to the customer is fixed or determinable, and collectibility is reasonably assured, which is generally at the time of product shipment. Typical sales arrangements are for standard products and provide for transfer of ownership and risk of loss at the time of shipment. In limited circumstances where significant obligations to the customer are unfulfilled at the time of shipment, typically involving installation and customer acceptance, revenue recognition is deferred until such obligations have been completed. Customer allowances and rebates, consisting primarily of volume discounts and other short-term incentive programs, are estimated at the time of sale based on historical experience and known trends and are recorded as a reduction in reported revenues. No single customer accounted for more than 5% of consolidated revenues in 2012, 2011 or 2010.

In October 2009, new accounting guidance was issued on multiple-deliverable revenue arrangements. The new accounting guidance amends the accounting for multiple-deliverable arrangements to enable the vendor to account for product or services separately rather than as a combined unit. The guidance establishes a hierarchy for determining the selling price of a deliverable, which is based on: (1) vendor-specific objective evidence, (2) third-party evidence or (3) estimates. The Company adopted the new accounting guidance on January 1, 2011, and the adoption did not materially affect the Company’s financial position or results of operations.

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Rental Expense

12 Months Ended

Dec. 31, 2012

Leases [Abstract]

Rental Expense

Rental Expense was $178 million in 2012, $178 million in 2011 and $165 million in 2010. Future minimum lease payments under non-cancelable leases for the years ending December 31 are as follows:

In millions
2013	$	153
2014	113
2015	81
2016	61
2017	47
2018 and future years	67
	$	522

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Divestiture of Majority Interest in Decorative Surfaces Segment (Details) (USD $)	3 Months Ended	12 Months Ended				3 Months Ended			3 Months Ended		10 Months Ended	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Nov. 01, 2012	Dec. 31, 2012 Wilsonart International Holdings LLC [Member]	Nov. 01, 2012 Wilsonart International Holdings LLC [Member]	Oct. 31, 2012 Wilsonart International Holdings LLC [Member]	Dec. 31, 2012 Cumulative Convertible Participating Preferred Units [Member] Wilsonart International Holdings LLC [Member]	Oct. 31, 2012 Cumulative Convertible Participating Preferred Units [Member] Wilsonart International Holdings LLC [Member]	Oct. 31, 2012 Decorative Surfaces [Member]	Dec. 31, 2012 Decorative Surfaces [Member]	Dec. 31, 2011 Decorative Surfaces [Member]	Dec. 31, 2010 Decorative Surfaces [Member]	Aug. 15, 2012 Decorative Surfaces [Member]
Schedule of Equity Method Investments [Line Items]
% of Decorative Surfaces Segment that was divested															51.00%
Pretax gain on sale of portion of Decorative Surfaces segment											$ 933,000,000
After Tax gain on sale of portion of Decorative Surfaces segment											632,000,000
Net sales proceeds on sale of Wilsonart and Subsidiaries	1,050,000,000
Ownership percentage in Wilsonart						49.00%		49.00%
Contribution amount of CD&R in exchange for Wilsonart preferred units					395,000,000
% of Preferred Units of Wilsonart							51.00%
Preferred units initial liquidation preference										395,000,000
Dividend rate for Preferred Units									10.00%
Increased dividend rate of Preferred Units									12.00%
Third party indebtedness of Wilsonart								725,000,000
Fair value of Company's retained interest	174,000,000	174,000,000	0					204,000,000
Pre-tax gain on retained interest						51,000,000
Equity loss in Wilsonart		(30,000,000)	0	0		(30,000,000)
Historical Operating Results [Abstract]
Operating revenues		17,924,000,000	17,787,000,000	15,416,000,000							921,000,000	921,000,000	1,084,000,000	992,000,000
Operating income		$ 2,847,000,000	$ 2,731,000,000	$ 2,254,000,000							$ 122,000,000	$ 122,000,000	$ 132,000,000	$ 117,000,000

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Stockholders' Equity (Details 1) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Changes in Accumulated Other Comprehensive Income
Beginning balance, amount	$ 224	$ 427	$ 249
Foreign currency translation adjustments	94	(141)	153
Pension and other postretirement benefits actuarial gains (losses), net of tax of $55 million in 2012, $54 million in 2011 and $(3) million in 2010	(104)	(93)	4
Amortization of unrecognized pension and other postretirement benefits costs, net of tax of $(22) million in 2012, $(17) million in 2011 and $(12) million in 2010	40	31	21
Pension and other postretirement benefits settlements, curtailments and other, net of tax of $(21) million in 2012	39	0	0
Ending balance, amount	$ 293	$ 224	$ 427

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Trade Receivables (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Changes in allowances for uncollectible accounts
Beginning balance	$ (65)	$ (70)	$ (76)
Provision charged to expense	(11)	(5)	(4)
Write-offs, net of recoveries	14	10	12
Acquisitions and divestitures	0	(4)	(3)
Foreign currency translation	(1)	2	1
Other	(2)	2	0
Ending balance	$ (65)	$ (65)	$ (70)

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Discontinued Operations (Details 1) (Finishing and Consumer Packaging Businesses [Member], USD $) In Millions, unless otherwise specified	Dec. 31, 2011
Finishing and Consumer Packaging Businesses [Member]
The assets and liabilities of the finishing and consumer packaging businesses
Trade receivables	$ 72
Inventories	56
Net plant and equipment	44
Goodwill and intangible assets	201
Other	13
Total assets held for sale	386
Accounts payable	22
Accrued expenses	55
Other	30
Total liabilities held for sale	$ 107

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Pension and Other Postretirement Benefits (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Components of net periodic benefit cost:
Income from continuing operations	$ 2,495	$ 2,017	$ 1,452
Income from Discontinued Operations	375	54	51
Net income	2,870	2,071	1,503
Pension
Components of net periodic benefit cost:
Service cost	100	94	94
Interest cost	107	116	110
Expected return on plan assets	(157)	(157)	(150)
Amortization of actuarial loss	57	39	26
Amortization of prior service cost	1	1	1
Settlement/curtailment loss	14	0	1
Net periodic benefit cost	122	93	82
Income from continuing operations	121	89	80
Income from Discontinued Operations	1	4	2
Net income	122	93	82
Other Postretirement Benefits
Components of net periodic benefit cost:
Service cost	13	14	14
Interest cost	27	30	30
Expected return on plan assets	(20)	(21)	(18)
Amortization of actuarial loss	1	0	0
Amortization of prior service cost	3	6	6
Settlement/curtailment loss	0	0	0
Net periodic benefit cost	24	29	32
Income from continuing operations	24	29	32
Income from Discontinued Operations	0	0	0
Net income	$ 24	$ 29	$ 32

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International Reporting Lag (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2010
Impact of elimination of one month reporting lag for international operations outside of North America
Operating revenues	$ (22)
Income from continuing operations	(25)
Income from continuing operations per diluted share	$ (0.04)
Net income	$ (24)
Net income per diluted share	$ (0.04)

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Investments (Details 2) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Investment in leases of equipment
Total investment in leases of equipment	$ 33	$ 275
Aircraft
Investment in leases of equipment
Total investment in leases of equipment	33	34
Telecommunications
Investment in leases of equipment
Total investment in leases of equipment	0	171
Air traffic control
Investment in leases of equipment
Total investment in leases of equipment	$ 0	$ 70

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Segment Information (Details Textual) (USD $) In Billions, unless otherwise specified	12 Months Ended				12 Months Ended
	Dec. 31, 2012 Segment	Dec. 31, 2011	Dec. 31, 2012 Wilsonart International Holdings LLC [Member]	Oct. 31, 2012 Wilsonart International Holdings LLC [Member]	Dec. 31, 2013 Subsequent Event [Member] Segment
Segment Reporting Information [Line Items]
Number of external reporting segments	7				8
Ownership percentage in Wilsonart			49.00%	49.00%
Total noncurrent assets excluding deferred tax assets and financial instruments	$ 11.0	$ 10.2
Percentage attributed to U.S. Operations	53.00%	52.00%

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2012

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies—The Company is subject to various legal proceedings and claims that arise in the ordinary course of business, including those involving environmental, product liability (including toxic tort) and general liability claims. The Company accrues for such liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Such accruals are based on developments to date, the Company’s estimates of the outcomes of these matters and its experience in contesting, litigating and settling other similar matters. The Company believes resolution of these matters, individually and in the aggregate, will not have a material adverse effect on the Company’s financial position, liquidity or future operations.

Among the toxic tort cases in which the Company is a defendant, the Company and its subsidiaries Hobart Brothers Company and Miller Electric Mfg. Co. have been named, along with numerous other defendants, in lawsuits alleging injury from exposure to welding consumables. The plaintiffs in these suits claim unspecified damages for injuries resulting from the plaintiffs’ alleged exposure to asbestos, manganese and/or toxic fumes in connection with the welding process. In the first quarter of 2012, the Company entered into an agreement resolving substantially all of the manganese-related claims for an immaterial amount. As of December 31, 2012, a majority of the cases against the Company, Hobart Brothers and Miller Electric have been dismissed. The Company believes that the remaining claims will not have a material adverse effect on the Company’s operating results, financial position or cash flows. The Company has not recorded any significant reserves related to these cases.

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Investments (Tables)

12 Months Ended

Dec. 31, 2012

Investments Disclosure [Abstract]

Investments

Investments as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Leases of equipment	$	33	$	275
Venture capital limited partnership	36		43
Properties held for sale	39		42
Property developments	26		26
Affordable housing limited partnerships	12		23
	$	146	$	409

Components of Investment in Leases of Equipment

The components of the investment in leases of equipment at December 31, 2012 and 2011 were as shown below:

In millions	2012			2011
Leveraged and direct financing leases:
Gross lease contracts receivable, net of nonrecourse debt service	$	—		$	130
Estimated residual value of leased assets	28			248
Unearned income	(1		)	(110		)
	27			268
Equipment under operating leases	6			7
	$	33		$	275

Investment in Leases of Equipment by Types of Equipment

The investment in leases of equipment at December 31, 2012 and 2011 consisted of the following types of equipment:

In millions	2012		2011
Aircraft	$	33	$	34
Telecommunications	—		171
Air traffic control	—		70
	$	33	$	275

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Cash and Equivalents

12 Months Ended

Dec. 31, 2012

Cash and Cash Equivalents [Abstract]

Cash and Equivalents

Cash and Equivalents included interest-bearing instruments of $1.0 billion at December 31, 2012 and $551 million at December 31, 2011. These interest-bearing instruments have maturities of 90 days or less and are stated at cost, which approximates fair value.

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Long-Term Debt (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Long-Term Debt
Long-Term Debt including current maturities	$ 4,595	$ 3,750
Long-term Debt, Fair Value	5,105	4,234
Current maturities	(6)	(262)
Long-Term Debt excluding current maturities	4,589	3,488
6.55% preferred debt securities due December 31, 2011 [Member]
Long-Term Debt
Long-Term Debt including current maturities	0	250
Long-term Debt, Fair Value	0	250
5.15% notes due April 1, 2014 [Member]
Long-Term Debt
Long-Term Debt including current maturities	800	800
Long-term Debt, Fair Value	846	877
5.25% Euro notes due October 1, 2014 [Member]
Long-Term Debt
Long-Term Debt including current maturities	989	971
Long-term Debt, Fair Value	1,071	1,064
6.25% notes due April 1, 2019 [Member]
Long-Term Debt
Long-Term Debt including current maturities	700	700
Long-term Debt, Fair Value	877	872
4.88% notes due thru December 31, 2020 [Member]
Long-Term Debt
Long-Term Debt including current maturities	12	22
Long-term Debt, Fair Value	13	24
3.375% notes due September 15, 2021 [Member]
Long-Term Debt
Long-Term Debt including current maturities	349	348
Long-term Debt, Fair Value	381	368
4.875% notes due September 15, 2041 [Member]
Long-Term Debt
Long-Term Debt including current maturities	641	641
Long-term Debt, Fair Value	770	761
3.9% notes due September 1, 2042 [Member]
Long-Term Debt
Long-Term Debt including current maturities	1,089	0
Long-term Debt, Fair Value	1,132	0
Other borrowings [Member]
Long-Term Debt
Long-Term Debt including current maturities	15	18
Long-term Debt, Fair Value	$ 15	$ 18

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Investments

12 Months Ended

Dec. 31, 2012

Investments Disclosure [Abstract]

Investments

Investments as of December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Leases of equipment	$	33	$	275
Venture capital limited partnership	36		43
Properties held for sale	39		42
Property developments	26		26
Affordable housing limited partnerships	12		23
	$	146	$	409

Leases of Equipment

The components of the investment in leases of equipment at December 31, 2012 and 2011 were as shown below:

In millions	2012			2011
Leveraged and direct financing leases:
Gross lease contracts receivable, net of nonrecourse debt service	$	—		$	130
Estimated residual value of leased assets	28			248
Unearned income	(1		)	(110		)
	27			268
Equipment under operating leases	6			7
	$	33		$	275

Deferred tax liabilities related to leases of equipment were $38 million and $54 million at December 31, 2012 and 2011, respectively.

The investment in leases of equipment at December 31, 2012 and 2011 consisted of the following types of equipment:

In millions	2012		2011
Aircraft	$	33	$	34
Telecommunications	—		171
Air traffic control	—		70
	$	33	$	275

Income from leveraged leases was $5 million, $13 million and $11 million for the years ended December 31, 2012, 2011 and 2010, respectively. Unearned income related to leveraged leases is recognized as lease income over the life of the lease based on the effective yield of the lease. The Company adjusts recognition of lease income on its leveraged leases when there is a change in the assumptions affecting total income or the timing of cash flows associated with the lease. The residual values of leased assets are estimated at the inception of the lease based on market appraisals and reviewed for impairment at least annually.

In 2012, the Company terminated leveraged leasing transactions related to mobile telecommunications equipment with two major European telecommunications companies and a leveraged lease transaction related to air traffic control equipment in Australia. The Company received proceeds of $231 million and recorded a loss of $8 million related to these transactions. Income from leveraged leases and the loss on the terminated leveraged leasing transactions were included in Other income (expense) in the consolidated statement of income.

Other Investments

The Company entered into a venture capital limited partnership in 2001 that invests primarily in late-stage venture capital opportunities. The Company has a 25% limited partnership interest and accounts for this investment using the equity method, whereby the Company recognizes its proportionate share of the partnership's income or loss. The partnership’s financial statements are prepared on a mark-to-market basis.

The Company invested in property developments with a residential construction developer through partnerships in which the Company has a 50% interest. These partnership investments are accounted for using the equity method, whereby the Company recognizes its proportionate share of the partnerships' income or loss.

The Company entered into several affordable housing limited partnerships primarily to receive tax benefits in the form of tax credits and tax deductions from operating losses. These affordable housing investments are accounted for using the effective yield method, in which the investment is amortized to income tax expense as the tax benefits are received. The tax credits are credited to income tax expense as they are allocated to the Company.

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Goodwill and Intangible Assets Fair Value of Intangible Assets (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2010	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill Before Impairment		$ 146	$ 0	$ 0
Goodwill After Impairment		145	0	0
Goodwill, impairment charges		1	0	0
Indefinite-lived intangible assets before Impairment		5	0	20
Indefinite-lived intangible asset after impairment		4	0	19
Impairment	$ 0	$ 1	$ 0	$ 1

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Prepaid Expenses and Other Current Assets (Tables)

12 Months Ended

Dec. 31, 2012

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Prepaid expenses and other current assets

Prepaid Expenses and Other Current Assets as of December 31, 2012 and 2011 were as follows:

In millions	2012		2011
Income tax refunds receivable	$	231	$	112
Value-added-tax receivables	71		65
Vendor advances	52		40
Other	168		167
	$	522	$	384

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Pension and Other Postretirement Benefits (Details 3) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Pension
Funded status
Funded status	$ (367)	$ (411)
Other immaterial plans	(58)	(63)
Net liability at December 31	(425)	(474)
Other Postretirement Benefits
Funded status
Funded status	(261)	(272)
Other immaterial plans	(7)	(7)
Net liability at December 31	$ (268)	$ (279)

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Discontinued Operations (Tables)

12 Months Ended

Dec. 31, 2012

Discontinued Operations and Disposal Groups [Abstract]

Results of discontinued operations

Results of the discontinued operations for the years ended December 31, 2012, 2011 and 2010 were as follows:

In millions	2012			2011			2010
Operating revenues	$	142		$	470		$	433
Income before income taxes	$	488		$	82		$	85
Income tax expense	(113		)	(28		)	(34		)
Income from discontinued operations	$	375		$	54		$	51

The assets and liabilities held for sale of the finishing and consumer packaging businesses

Assets and liabilities held for sale at December 31, 2011 included both the consumer packaging and finishing businesses discussed above. The following table summarizes the classes of assets and liabilities held for sale at December 31, 2011:

In millions	December 31, 2011
Trade receivables	$	72
Inventories	56
Net plant and equipment	44
Goodwill and intangible assets	201
Other	13
Total assets held for sale	$	386
Accounts payable	$	22
Accrued expenses	55
Other	30
Total liabilities held for sale	$	107

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Pension and Other Postretirement Benefits (Details 5) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Postretirement benefit obligation
Health care cost trend rate assumed for the next year	7.35%	8.50%	8.71%
Ultimate trend rate	5.00%	5.00%	5.00%
Year the rate reaches the ultimate trend rate	2019	2019	2020
One-percentage-point change in assumed health care cost trend rates
1-Percentage-Point Increase - Change in service cost and interest cost	1
1-Percentage-Point Decrease - Change in service cost and interest cost	(1)
Defined Benefit Plan, Effect of One Percentage Point Increase on Accumulated Postretirement Benefit Obligation	13
1-Percentage-Point Decrease - Change in postretirement benefit obligation	(16)
Pension
Assumptions used to determine benefit obligations
Discount rate	3.85%	4.64%	5.05%
Rate of compensation increases	3.86%	3.86%	3.94%
Assumptions used to determine net periodic benefit cost for years ended December 31:
Discount rate	4.64%	5.05%	5.57%
Expected return on plan assets	7.23%	7.39%	7.63%
Rate of compensation increases	3.86%	3.94%	4.18%
Other Postretirement Benefits
Assumptions used to determine benefit obligations
Discount rate	4.15%	4.95%	5.45%
Rate of compensation increases	0.00%	0.00%	0.00%
Assumptions used to determine net periodic benefit cost for years ended December 31:
Discount rate	4.95%	5.45%	5.80%
Expected return on plan assets	7.00%	7.00%	7.00%
Rate of compensation increases	0.00%	0.00%	0.00%

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Statement of Financial Position (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Current Assets:
Cash and equivalents	$ 2,779	$ 1,178
Trade receivables	2,742	2,819
Inventories	1,585	1,716
Deferred income taxes	332	366
Prepaid expenses and other current assets	522	384
Assets held for sale	0	386
Total current assets	7,960	6,849
Net plant and equipment	1,994	2,025
Investments	146	409
Goodwill	5,530	5,198
Intangible assets	2,258	2,233
Deferred income taxes	391	634
Other assets	1,030	636
Total Assets	19,309	17,984
Current Liabilities:
Short-term debt	459	502
Accounts payable	676	697
Accrued expenses	1,392	1,435
Cash dividends payable	0	174
Income taxes payable	116	57
Deferred income taxes	8	5
Liabilities held for sale	0	107
Total current liabilities	2,651	2,977
Noncurrent Liabilities:
Long-term debt	4,589	3,488
Deferred income taxes	244	117
Other liabilities	1,255	1,368
Total noncurrent liabilities	6,088	4,973
Stockholders’ Equity:
Common stock issued—549,551,660 shares in 2012 and 542,500,435 shares in 2011	5	5
Additional paid-in-capital	1,012	686
Income reinvested in the business	13,973	11,794
Common stock held in treasury	(4,722)	(2,692)
Accumulated other comprehensive income	293	224
Noncontrolling interest	9	17
Total stockholders’ equity	10,570	10,034
Total Liabilities and Stockholders' Equity	$ 19,309	$ 17,984

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Plant and Equipment (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Plant and Equipment (Textual) [Abstract]
Depreciation included in income from continuing operations	$ 323	$ 334	$ 328
Depreciation included in income from discontinued operations	$ 0	$ 2	$ 7
Equipment leased to others [Member]
Range of useful lives used to depreciate plant and equipment
Useful life of equipment leased to others	Term of Lease
Minimum [Member] | Buildings and improvements [Member]
Range of useful lives used to depreciate plant and equipment
Plant and Equipment, Useful Life	5 years
Minimum [Member] | Machinery and equipment [Member]
Range of useful lives used to depreciate plant and equipment
Plant and Equipment, Useful Life	3 years
Maximum [Member] | Buildings and improvements [Member]
Range of useful lives used to depreciate plant and equipment
Plant and Equipment, Useful Life	50 years
Maximum [Member] | Machinery and equipment [Member]
Range of useful lives used to depreciate plant and equipment
Plant and Equipment, Useful Life	12 years

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Consolidation and Translation

12 Months Ended

Dec. 31, 2012

Consolidation and Translation [Abstract]

Consolidation and Translation

Consolidation and Translation—The financial statements include the Company and its majority-owned subsidiaries. The Company follows the equity method of accounting for investments where the Company has a significant influence but not a controlling interest. All significant intercompany transactions are eliminated from the financial statements. Foreign subsidiaries’ assets and liabilities are translated to U.S. dollars at end-of-period exchange rates. Revenues and expenses are translated at average rates for the period. Translation adjustments are reported as a component of accumulated other comprehensive income in stockholders’ equity.

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Other Noncurrent Liabilities (Tables)

12 Months Ended

Dec. 31, 2012

Other Liabilities Disclosure [Abstract]

Other noncurrent liabilities

Other Noncurrent Liabilities at December 31, 2012 and 2011 consisted of the following:

In millions	2012		2011
Pension benefit obligation	$	470	$	481
Postretirement benefit obligation	261		272
Other	524		615
	$	1,255	$	1,368

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Income Taxes (Details Textual) (USD $)	3 Months Ended
	Dec. 31, 2012	Mar. 31, 2011	Mar. 31, 2010	Dec. 31, 2011
Income Taxes (Textual) [Abstract]
Decrease in unrecognized tax benefits resulting from Australian tax matter		$ 197,000,000
Discrete non-cash tax benefit resulting from Australian Tax Office matter		166,000,000
Deferred Tax Liabilities, Undistributed Foreign Earnings	8,300,000,000			6,300,000,000
Deferred Tax Assets, Tax Credit Carryforwards, Foreign	31,000,000
Unrecognized Tax Benefits that Would Impact Effective Tax Rate	249,000,000
Decrease in unrecognized tax benefits resulting from resolution of U.S. tax matter	125,000,000	179,000,000
Discrete tax charge resulting from resolution of U.S. tax matter	35,000,000
Discrete Tax Charge, Health Care Reform Legislation			22,000,000
Possible decrease in unrecognized tax benefits resulting from ongoing audits	39,000,000
Accrual for Interest and Penalties Related to Income Tax Matters	$ 16,000,000			$ 2,000,000

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Pension and Other Postretirement Benefits (Details 4) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
The amounts recognized in the statement of financial position as of December 31 consist of:
Liabilities held for sale	$ (19)	$ (28)
Pension
The amounts recognized in the statement of financial position as of December 31 consist of:
Net liability at December 31	(425)	(474)
The pre-tax amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss	892	848
Prior service cost	7	4
Net Loss, Prior service cost and Net transaction obligation, Total	899	852
Accumulated benefit obligation	2,358	2,193
Plans with accumulated benefit obligation in excess of plan assets as of December 31:
Projected benefit obligation	1,928	1,838
Accumulated benefit obligation	1,741	1,665
Fair value of plan assets	1,524	1,414
Other Postretirement Benefits
The amounts recognized in the statement of financial position as of December 31 consist of:
Net liability at December 31	(268)	(279)
The pre-tax amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss	10	15
Prior service cost	2	5
Net Loss, Prior service cost and Net transaction obligation, Total	12	20
Other assets | Pension
The amounts recognized in the statement of financial position as of December 31 consist of:
Other assets	57	41
Other assets | Other Postretirement Benefits
The amounts recognized in the statement of financial position as of December 31 consist of:
Other assets	0	0
Accrued expenses | Pension
The amounts recognized in the statement of financial position as of December 31 consist of:
Liabilities held for sale	(12)	(21)
Accrued expenses | Other Postretirement Benefits
The amounts recognized in the statement of financial position as of December 31 consist of:
Liabilities held for sale	(7)	(7)
Liabilities held for sale | Pension
The amounts recognized in the statement of financial position as of December 31 consist of:
Liabilities held for sale	0	(13)
Liabilities held for sale | Other Postretirement Benefits
The amounts recognized in the statement of financial position as of December 31 consist of:
Liabilities held for sale	0	0
Other noncurrent liabilities | Pension
The amounts recognized in the statement of financial position as of December 31 consist of:
Other noncurrent liabilities	(470)	(481)
Other noncurrent liabilities | Other Postretirement Benefits
The amounts recognized in the statement of financial position as of December 31 consist of:
Other noncurrent liabilities	$ (261)	$ (272)

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Acquisitions (Details 1) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Premium over tangible net assets recorded for acquisitions based on purchase price allocations
Goodwill Recorded	$ 333	$ 476	$ 219
Amortizable intangible assets:
Weighted- Average Life	10 years 8 months 12 days	13 years 1 month 6 days	12 years 1 month 6 days
Premium Recorded	284	743	241
Total intangible assets:
Total premium recorded	659	1,224	460
Trademarks and brands
Indefinite-lived intangible assets:
Premium Recorded	42	5	0
Customer lists and relationships
Amortizable intangible assets:
Weighted- Average Life	12 years 2 months 12 days	12 years 2 months 12 days	11 years 9 months 18 days
Premium Recorded	169	362	121
Patents and proprietary technology
Amortizable intangible assets:
Weighted- Average Life	8 years 2 months 12 days	9 years 7 months 6 days	10 years 10 months 24 days
Premium Recorded	38	98	32
Trademarks and brands
Amortizable intangible assets:
Weighted- Average Life	12 years 9 months 18 days	17 years 3 months 18 days	14 years 10 months 24 days
Premium Recorded	36	245	71
Noncompete agreements
Amortizable intangible assets:
Weighted- Average Life	4 years 6 months	5 years	5 years 3 months 18 days
Premium Recorded	29	27	5
Other
Amortizable intangible assets:
Weighted- Average Life	7 years 2 months 12 days	1 year 9 months 18 days	4 years 10 months 24 days
Premium Recorded	$ 12	$ 11	$ 12

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Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets—Goodwill represents the excess cost over fair value of the net assets of purchased businesses. The Company does not amortize goodwill and intangible assets that have indefinite lives. The Company performs an annual impairment assessment of goodwill and intangible assets with indefinite lives based on the estimated fair value of the related reporting unit or intangible asset. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.

When performing its annual impairment assessment, the Company evaluates the goodwill assigned to each of its 40 reporting units for potential impairment by comparing the estimated fair value of the relevant reporting unit to the carrying value. The Company uses various valuation techniques to determine the fair value of its reporting units, including discounting estimated future cash flows based on a detailed cash flow forecast prepared by the relevant reporting unit, market multiples from similar transactions and quoted market prices of relevant public companies. If the fair value of a reporting unit is less than its carrying value, an impairment loss, if any, is recorded for the difference between the implied fair value and the carrying value of the reporting unit's goodwill.

The Company's indefinite-lived intangible assets consist of trademarks and brands. The estimated fair values of these intangible assets are determined based on a relief-of-royalty income approach derived from internally forecasted revenues of the related products. If the fair value of the trademark or brand is less than its carrying value, an impairment loss is recorded for the difference between the estimated fair value and carrying value of the intangible asset.

Amortization and impairment of goodwill and other intangible assets for the years ended December 31, 2012, 2011 and 2010 were as follows:

In millions	2012		2011		2010
Goodwill:
Impairment	$	1	$	—	$	—
Intangible Assets:
Amortization	288		255		207
Impairment	1		—		1
	$	290	$	255	$	208

Income from discontinued operations included no intangible asset amortization in 2012, $3 million in 2011 and $6 million in 2010.

The Company performed its annual impairment assessment of goodwill and indefinite-lived intangible assets in the third quarter of 2012, 2011 and 2010. In the third quarter of 2012, these assessments resulted in a goodwill impairment charge of approximately $1 million related to the pressure sensitive adhesives reporting unit in the Power Systems & Electronics segment and an intangible asset impairment charge of approximately $1 million related to an international reporting unit in the Food Equipment segment. There were no impairment charges in 2011. In 2010, there was an intangible asset impairment charge of approximately $1 million related to the test and measurement reporting unit in the All Other segment.

A summary of goodwill and indefinite-lived intangible assets that were adjusted to fair value and the related impairment charges included in earnings for 2012, 2011 and 2010 is as follows:

	2012						2011						2010
In millions	Book Value		Fair Value		Total Impairment Charges		Book Value		Fair Value		Total Impairment Charges		Book Value		Fair Value		Total Impairment Charges
Goodwill	$	146	$	145	$	1	$	—	$	—	$	—	$	—	$	—	$	—
Indefinite-lived intangible assets	5		4		1		—		—		—		20		19		1

The changes in the carrying amount of goodwill for the years ended December 31, 2012 and 2011 were as follows:

In millions	Transpor-tation			Power Systems & Electronics			Industrial Packaging			Food Equipment			Construction Products			Polymers & Fluids			Decorative Surfaces			All Other			Total
Balance, December 31, 2010	$	567		$	429		$	769		$	204		$	585		$	844		$	13		$	1,561		$	4,972
2011 activity:
Acquisitions & divestitures	118			242			25			(1		)	6			50			—			24			464
Impairment charges	—			—			—			—			—			—			—			—			—
Foreign currency translation	(9		)	(3		)	(11		)	(4		)	(1		)	(17		)	—			(3		)	(48		)
Transfer to assets held for sale	—			(7		)	—			—			—			—			—			(183		)	(190		)
Intersegment goodwill transfers	1			342			—			—			—			(156		)	—			(187		)	—
Balance, December 31, 2011	$	677		$	1,003		$	783		$	199		$	590		$	721		$	13		$	1,212		$	5,198
2012 activity:
Acquisitions & divestitures	8			19			(6		)	1			6			38			(13		)	231			284
Impairment charges	—			(1		)	—			—			—			—			—			—			(1		)
Foreign currency translation	11			8			10			3			7			(2		)	—			12			49
Intersegment goodwill transfers	78			53			(52		)	—			—			(43		)	—			(36		)	—
Balance, December 31, 2012	$	774		$	1,082		$	735		$	203		$	603		$	714		$	—		$	1,419		$	5,530
Accumulated goodwill impairment charges, December 31, 2012	$	36		$	89		$	114		$	60		$	7		$	15		$	—		$	46		$	367

The Company periodically makes changes to its management reporting structure to better align its businesses with Company objectives and operating strategies. In 2011 and 2012, the Company made certain changes in its management reporting structure that resulted in changes in some of the reportable segments. Accordingly, the Company reallocated goodwill between segments based on these changes which did not result in any goodwill impairment charges in 2011 or 2012. See the Segment Information note for further discussion of these segment changes.

Intangible assets as of December 31, 2012 and 2011 were as follows:

	2012							2011
In millions	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Amortizable intangible assets:
Customer lists and relationships	$	1,749	$	(661	)	$	1,088	$	1,608	$	(522	)	$	1,086
Patents and proprietary technology	593		(285		)	308		561		(236		)	325
Trademarks and brands	747		(206		)	541		700		(157		)	543
Software	206		(188		)	18		201		(172		)	29
Noncompete agreements	204		(157		)	47		181		(148		)	33
Other	121		(109		)	12		117		(103		)	14
Total amortizable intangible assets	3,620		(1,606		)	2,014		3,368		(1,338		)	2,030
Indefinite-lived intangible assets:
Trademarks and brands	244		—			244		203		—			203
Total intangible assets	$	3,864	$	(1,606	)	$	2,258	$	3,571	$	(1,338	)	$	2,233

Amortizable intangible assets are being amortized primarily on a straight-line basis over their estimated useful lives of 3 to 20 years.

The estimated amortization expense of intangible assets for the future years ending December 31 is as follows:

In millions
2013	$	265
2014	249
2015	235
2016	221
2017	201

On January 1, 2012, the Company adopted new accounting guidance which provides the option to first assess qualitative factors in determining whether it is necessary to perform the two-step test for goodwill impairment.  Under the new guidance, further testing using the two-step test would only be required when, based on the qualitative assessment, it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount.  The adoption of the new accounting guidance did not impact the Company's consolidated financial statements.

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Long-Term Debt (Details 2) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Scheduled maturities of long-term debt
2013	$ 6
2014	1,793
2015	2
2016	1
2017	1
2018 and future years	2,792
Long-Term Debt including current maturities	$ 4,595	$ 3,750

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Segment Information Segment Information (Details 2) (Details)	12 Months Ended
	Dec. 31, 2012
Segment Reporting [Abstract]
Number of Reportable Segments	40
Approximate Number of Operations	750

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Stock-Based Compensation (Details Textual) (USD $) In Millions, except Share data, unless otherwise specified	0 Months Ended	12 Months Ended
	Feb. 10, 2012	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Stock Based Compensation (Additional Textual) [Abstract]
Vesting period for stock options		4 years
Maturity period for stock options from issuance date		10 years
Vesting period for restricted stock units		after 3 Years
Shares reserved for issuance under ITW's 2011 Long-Term Incentive Plan		43,631,941
Vesting period for RSU awards	after 3 years from date of grant
Vesting period for PRSU awards	after 3 years if performance goals were met
Number of shares for each vested RSU or PRSU award	1
Weighted-average grant-date fair value of options granted		$ 11.48	$ 12.34	$ 9.59
Aggregate intrinsic value of options exercised		$ 84	$ 63	$ 56
Cash receipts from exercise of options		285	151	114
Total fair value of vested stock option awards		48	33	30
Total fair value of vested restricted stock unit awards		31	1
Stock Options [Member]
Stock Based Compensation (Textual) [Abstract]
Total unrecognized compensation cost related to non-vested stock awards		20
Weighted-average period (years) to recognize total unrecognized compensation cost		2 years 4 months 24 days
Restricted Stock Units (RSUs) [Member]
Stock Based Compensation (Textual) [Abstract]
Total unrecognized compensation cost related to non-vested stock awards		$ 22
Weighted-average period (years) to recognize total unrecognized compensation cost		1 year 8 months 12 days

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Advertising Expenses (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Advertising Expenses (Textual) [Abstract]
Advertising Expense	$ 84	$ 88	$ 72

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Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2012

Accounting Policies [Abstract]

Commercial Paper

Commercial paper is stated at cost, which approximates fair value.

International Reporting Lag

International Reporting Lag—

the Company is now reporting both North American and international results on a calendar year basis.

Consolidation and Translation

Consolidation and Translation—The financial statements include the Company and its majority-owned subsidiaries. The Company follows the equity method of accounting for investments where the Company has a significant influence but not a controlling interest. All significant intercompany transactions are eliminated from the financial statements. Foreign subsidiaries’ assets and liabilities are translated to U.S. dollars at end-of-period exchange rates. Revenues and expenses are translated at average rates for the period. Translation adjustments are reported as a component of accumulated other comprehensive income in stockholders’ equity.

Acquisitions

Acquisitions—The Company accounts for acquisitions under the acquisition method, in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition. The operating results of the acquired companies are included in the Company’s consolidated financial statements from the date of acquisition.

Operating Revenues

Operating Revenuesare recognized when persuasive evidence of an arrangement exists, product has shipped and the risks and rewards of ownership have transferred or services have been rendered, the price to the customer is fixed or determinable, and collectibility is reasonably assured, which is generally at the time of product shipment. Typical sales arrangements are for standard products and provide for transfer of ownership and risk of loss at the time of shipment. In limited circumstances where significant obligations to the customer are unfulfilled at the time of shipment, typically involving installation and customer acceptance, revenue recognition is deferred until such obligations have been completed. Customer allowances and rebates, consisting primarily of volume discounts and other short-term incentive programs, are estimated at the time of sale based on historical experience and known trends and are recorded as a reduction in reported revenues.

Research and Development Expenses

Research and Development Expensesare recorded as expense in the year incurred.

Advertising Expenses

Advertising Expensesare recorded as expense in the year incurred.

Income Taxes

Deferred U.S. federal income taxes and foreign withholding taxes have not been provided on the remaining undistributed earnings of certain international subsidiaries as these earnings are considered permanently invested.

Valuation allowances are established when it is estimated that it is more likely than not that the tax benefit of the deferred tax asset will not be realized.

The Company recognizes interest and penalties related to income tax matters in income tax expense.

The Company utilizes the asset and liability method of accounting for income taxes. Deferred income taxes are determined based on the estimated future tax effects of differences between the financial and tax bases of assets and liabilities given the provisions of the enacted tax laws.

Income from Continuing Operations Per Share

Options that were considered antidilutive were not included in the computation of diluted income per share from continuing operations.

Income Per Share from Continuing Operationsis computed by dividing income from continuing operations by the weighted-average number of shares outstanding for the period. Income from continuing operations per diluted share is computed by dividing income from continuing operations by the weighted-average number of shares assuming dilution for stock options and restricted stock units.

Cash and Equivalents

These interest-bearing instruments have maturities of 90 days or less and are stated at cost, which approximates fair value.

Inventories

The first-in, first-out (“FIFO”) method, which approximates current cost, is used for all other inventories.

Inventories are stated at the lower of cost or market and include material, labor and factory overhead. The last-in, first-out (“LIFO”) method is used to determine the cost of the inventories of approximately 44% of the U.S. inventories.

Net Plant and Equipment

Net Plant and Equipmentare stated at cost, less accumulated depreciation. Renewals and improvements that increase the useful life of plant and equipment are capitalized. Maintenance and repairs are charged to expense as incurred.

Depreciation of plant and equipment for financial reporting purposes is computed on an accelerated basis for U.S. businesses and on a straight-line basis for a majority of the international businesses.

Investments

Unearned income related to leveraged leases is recognized as lease income over the life of the lease based on the effective yield of the lease. The Company adjusts recognition of lease income on its leveraged leases when there is a change in the assumptions affecting total income or the timing of cash flows associated with the lease. The residual values of leased assets are estimated at the inception of the lease based on market appraisals and reviewed for impairment at least annually.

These partnership investments are accounted for using the equity method, whereby the Company recognizes its proportionate share of the partnerships' income or loss.

accounts for this investment using the equity method, whereby the Company recognizes its proportionate share of the partnership's income or loss. The partnership’s financial statements are prepared on a mark-to-market basis.

These affordable housing investments are accounted for using the effective yield method, in which the investment is amortized to income tax expense as the tax benefits are received. The tax credits are credited to income tax expense as they are allocated to the Company.

Goodwill and Intangible Assets

Amortizable intangible assets are being amortized primarily on a straight-line basis over their estimated useful lives of 3 to 20 years.

The Company does not amortize goodwill and intangible assets that have indefinite lives. The Company performs an annual impairment assessment of goodwill and intangible assets with indefinite lives based on the estimated fair value of the related reporting unit or intangible asset. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.

Accrued Expenses

The Company accrues for product warranties based on historical experience.

Commitments and Contingencies

The Company accrues for such liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated.

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Income Per Share from Continuing Operations

12 Months Ended

Dec. 31, 2012

Earnings Per Share [Abstract]

Income Per Share from Continuing Operations

Income Per Share from Continuing Operationsis computed by dividing income from continuing operations by the weighted-average number of shares outstanding for the period. Income from continuing operations per diluted share is computed by dividing income from continuing operations by the weighted-average number of shares assuming dilution for stock options and restricted stock units. Dilutive shares reflect the potential additional shares that would be outstanding if the dilutive stock options outstanding were exercised and the unvested restricted stock units vested during the period. The computation of income per share from continuing operations was as follows:

In millions except per share amounts	2012		2011		2010
Income from continuing operations	$	2,495	$	2,017	$	1,452
Income per share from continuing operations—Basic:
Weighted-average common shares	469.8		491.4		500.8
Income per share from continuing operations—Basic	$	5.31	$	4.10	$	2.90
Income per share from continuing operations—Diluted:
Weighted-average common shares	469.8		491.4		500.8
Effect of dilutive stock options and restricted stock units	3.4		3.2		2.5
Weighted-average common shares assuming dilution	473.2		494.6		503.3
Income per share from continuing operations—Diluted	$	5.27	$	4.08	$	2.89

Options that were considered antidilutive were not included in the computation of diluted income per share from continuing operations. The number of antidilutive options outstanding as of December 31, 2012, 2011 and 2010 was 0.1 million, 5.0 million and 10.4 million, respectively.

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Other Assets (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Summary of Other Assets
Cash surrender value of life insurance policies	$ 391	$ 371
Wilsonart Equity Investment	174	0
Customer tooling	107	81
Prepaid pension assets	57	41
Other	301	143
Other Assets	$ 1,030	$ 636