On July 26, 3M (NYSE: MMM) announced its plans to spin-off its Health Care business, which would create two public companies that are well positioned to pursue their respective priorities. The transaction is expected to close by the end of 2023.
Health Care is anticipated to be spun off with net leverage of around 3.0x – 3.5x EBITDA. New 3M expected to retain a stake of 19.9% in Health Care.
The New 3M, with $26.8 billion in sales in 2021, will remain a global material science innovator serving customers across a range of industrial and consumer end markets. Health Care, with $8.6 billion in sales in 2021, will focus on wound care, healthcare IT, oral care and biopharma filtration. The spin-off will enhance value for customers as well as shareholders, provide each company with the ability to allocate capital to specific investments that will drive growth and set each company up for long term success.
Goldman Sachs & Co and PJT Partners are serving as financial advisors and Wachtell, Lipton, Rosen & Katz is serving as legal counsel on the spin-off of 3M’s Health Care business.
