3M says it has signed agreements relevant to selling "substantially all" of its Communication Markets Division to Corning Inc., for $900 million. 3M expects the sale to be finished in 2018, subject to customary closing conditions, regulatory approvals, consultation or information requirements with relevant works councils, and other adjustments.
Composed of fiber optics and copper passive connectivity services for the telecommunications industry, including 3M's xDSL, FTTx, and structured cabling services, and telecommunications system integration services in some countries, this business has annual global sales of around $400 million, says 3M. The company anticipates gaining approximately $0.40 per share from this transaction, net of actions related to the divestiture.
3M plans for approximately 500 of its 90,000 employees to transition to Corning upon the transaction's completion.
"After completing a thorough strategic review, we believe that this business will be well positioned with Corning," said Ashish Khandpur, executive vice president, Electronics & Energy Business Group.
Corning announced plans in April to supply fiber-optic cable and associated hardware to support Verizon's wireless broadband networks (see "Verizon signs $1.05B fiber deal with Corning to support wireless broadband"). The purchase of 3M should strengthen Corning's ability to provide fiber optics and copper passive connectivity in the future. While Corning is chiefly known for its fiber-optic products, it does have copper-based offerings in its portfolio already, particularly copper-based network interface devices (NIDs) and broadband coax connectors.
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