3M Company (MMM)

[DewDiligence]

Are market conditions such that 3M views the spinoff as a good way to pay down debt, or obtain funds for further innovation in the medical device sector or pharmaceutical/biotech sector? Funds for M/A with a target in mind?

The spinoff will include a large one-time cash transfer from Solventum to the post-spin 3M. 3M will use this cash to pay down debt and/or to help fund the earplug and PFAS legal settlements.

The post-spin 3M will almost certainly refrain from material M&A for a few years; it will instead focus on re-igniting organic growth and paying the legal settlements mentioned above.

On the other hand, Solventum could be a takeover target for a company such as DHR or TMO.