3M (NYSE:MMM) announced Tuesday that it will spin off its health-care business into a separate publicly traded company.
The new business will focus on wound and oral care, healthcare IT and biopharma filtration, the material science company said in a release. That includes products like its bandages, skin adhesives, oral aligners, air purifiers and optical lenses.
"Today's actions advance our ability to create value for customers and shareholders," said 3M CEO Mike Roman. "Disciplined portfolio management is a hallmark of our growth strategy. Our management team and board continually evaluate the strategic options that will best drive long-term sustainable growth and value. The decision to spin off our Health Care business will result in two well-capitalized, world-class companies, well positioned to pursue their respective priorities."
3M health-care products recorded more than $8 billion in sales in 2021. The transaction is expected to be completed by the end of next year.
The announcement comes alongside 3M’s second-quarter earnings report. The company posted adjusted earnings per share of $2.48 on revenue of $8.7 billion, surpassing analyst expectations of $2.42 per share and revenue of $8.58 billion, according to Refinitiv consensus estimates.
3M is simultaneously spinning off its food safety business. That branch will merge with Neogen (NASDAQ:NEOG) and is expected to be divested by September.
3M shares popped $9.08, or 6.8%, early Tuesday to $143.20.
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