Tags: 3M | sale | electronics | tapes

3M Said to Seek Sale of Electronics Units Valued at $1 Billion

Thursday, 27 Feb 2014 12:20 PM

3M Co. is working with Goldman Sachs Group Inc. to sell components of its electronics business that the industrial- and consumer-products maker has decided are underperforming, people with knowledge of the matter said.

The business units collectively represent about $1 billion in sales, said one of the people, who asked not to be identified because the information is private. 3M will probably sell them piecemeal since there isn’t an obvious buyer for the entire group, the person said. The units could collectively fetch about $1 billion if buyers are found, another person said. 3M reported sales of $31 billion in 2013.

Selling off the businesses reflects Chief Executive Officer Inge Thulin’s effort to push innovation throughout the company as it cuts costs and focuses on finding growth in health care, energy and aerospace. Since taking over at St. Paul, Minnesota-based 3M in February 2012, Thulin has increased spending on research and development, realigned business units and begun shedding underperforming businesses.

Jacqueline Berry, a spokeswoman for 3M, declined to comment on the company’s plans for the electronics businesses as did Michael Duvally at Goldman Sachs.

Thulin said in November 2012 that the company was conducting a strategic review of units with revenue totaling $2.5 billion that could be fixed, closed or sold. At the time, Thulin declined to say which businesses were part of the review.

As part of that review, the company said it was combining its security-systems division and traffic-safety units, which resulted in 300 job cuts. 3M also sold Scientific Anglers and Ross Reels, which make fishing line and reels, last year. The electronics units being sold are also a result of that review, according to the people familiar with the situation.

Economic Barometer

3M is a barometer for the global economy with sales of consumer, health-care, industrial, electronics and safety products in all regions of the world. The company is also considered a manufacturing bellwether because its industrial tapes, films and abrasives require short order times, providing early signals in demand shifts.

The company’s shares have climbed 30 percent in the year through yesterday, giving 3M a market value of $88 billion.

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3M Co. is working with Goldman Sachs Group Inc. to sell components of its electronics business that the industrial- and consumer-products maker has decided are underperforming, people with knowledge of the matter said.
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2014-20-27
Thursday, 27 Feb 2014 12:20 PM
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