3M Carries On With Its Portfolio Restructuring

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3M Company

3M (NYSE:MMM), on December 6th, announced that it has entered into an agreement to sell its prescription eyewear business to HOYA Vision Care, a global leader in the eyeglass lens industry. This business is a part of 3M’s Personal Safety division, which is in the Safety & Graphics business. While the terms of the transaction were not disclosed, it was stated that it is expected to close in the first quarter of 2017, subject to closing conditions. 140 employees, of 3M’s eyewear business, are expected to be absorbed by HOYA after the close of the deal.

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3M’s prescription eyewear business offers a wide variety of frames, prescription lenses, and premium coating solutions on customized products. The business, with over 90 years of experience as an industry leader in the safety prescription eyewear market in North America, has annual global sales of approximately $45 million. After a thorough strategic review, the company decided to divest itself from the business, in order to focus on the core personal safety business, according to Bernard Cicut, vice president and general manager, Personal Safety division. The company will retain its safety non-prescription eyewear business, referred to as Plano eyewear. 3M can be considered as a leader in providing personal safety solutions, which include respiratory protection, fall protection, hearing protection, and Plano eye protection.

3M Safety & Graphics - 1 3M Safety & Graphics - 2

3M has been very active on the M&A front in recent years, having made significant acquisitions such as Capital Safety, Polypore’s Separations Media business, and Ivera Medical Corp. Meanwhile, the company has also made an effort to slim down. Some of the big-ticket sales include that of its Static Control and Library Systems businesses, and Faab Fabricauto. In the beginning of 2015, 3M completed the sale of its Static Control business, which provides products that help prevent, detect, and protect against electrostatic discharge events, to Desco Industries. After a meticulous strategic review, the company took the decision of a sale of this segment, which had annual global sales of ~$45 million and employed 175 workers. The company also entered into agreements with One Equity Partners Capital Advisors for the sale of assets of its North American Library Systems and for the majority of its remaining global Library Systems business outside of North America. The sale ends 3M’s business in a segment in which it was prevalent for over 40 years, and wherein it popularized products like book sensor tape, electronic checkouts, and digital uploading of library e-books. 3M France also received a binding offer for 100% of the shares of Faab Fabricauto, which has annual sales of ~$30 million, and is a leading French manufacturer of license plates and signage solutions.

Since 2012 to early 2016, 3M has pruned its businesses from 40 to 26, thereby improving customer relevance, productivity, and speed, through a leaner operating structure. At the same time, 3M has steadily invested into R&D to develop innovative products. The company has stated its intentions to invest $1.8 billion in R&D during Financial Year 2016, to drive organic growth, and complement it through strategic acquisitions.

3M R&D

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