M announced Thursday that it plans to acquire Monroe, North Carolina-based Scott Safety, which manufactures safety equipment such as gas detection instruments, for $2 billion in cash and debt to expand its market share in that business.
Scott Safety is currently owned by Johnson Controls International Plc. It had revenue of $570 million in 2016 and employs 1,500 people around the world. It has a manufacturing facility in Union County that employs nearly 600 people.
The company manufactures products that help firefighters, police, military and rescue teams. 3M operates a safety division that makes items such as protective clothing and eye and face protection equipment.
“Personal safety is a core growth business within the 3M portfolio,” said 3M Chief Executive Officer Inge Thulin in a statement. “This acquisition leverages our fundamental strengths in technology, manufacturing, global capabilities and brand.”
St. Paul, Minnesota-based 3M estimates that the deal will be dilutive to its earnings in the first 12 months by 10 cents per share. The transaction is expected to close in the second half of the year.
Founded in 1932 by Earl M. Scott, Scott Safety started as an aviation components manufacturer based in Lancaster, New York. The company’s first product was a pivoting tail wheel for aircraft, which prevented airplane tails from scraping along the runway on an iron rod.
It has developed 34 new products within the past five years.
3M’s shares fell 78 cents, or 0.41 percent, to $190.42 in early Thursday trading. Johnson Controls shares rose 23 cents, or 0.55 percent, to $42.16.
Note: This story is from the North Carolina Business News Wire, a service of UNC-Chapel Hill’s School of Media and Journalism
