The industrial company, 3M Company, separates the medical division into a separate business

Industrial conglomerate 3M Company (MMM) announced its intention to separate the medical division into a public company. We will complete the deal in 2023, but already this week, it has become a driver of stock growth. At the auction, the MMM stock was worth $140.75, having risen by almost 5%. 3M Company announced the changes during the presentation of the results of the second quarter. According to the management, the new company will focus on creating a wound and oral care products. In addition, the company will have a division that will develop information technologies in healthcare and biopharmaceutical filtration. 

Note that this is not the first division. Earlier, 3M Company separated the food safety business into a separate company and merged it with Neogen to create a larger company. It will complete the deal for the separation of the medical unit next year. 3M Company’s revenue in the second quarter was higher than expected. Previously, the company assumed a decline in sales. Still, as a result, organic sales increased by 1% year-on-year. But the company continues to struggle with alarming economic trends, such as COVID-19 restrictions in China and a drop in demand for disposable face masks worldwide.

As a result, 3M Company lowered its full-year forecast for several indicators, including earnings per share and organic sales growth. Even after separating some divisions into new companies, 3M Company remains a diversified business. The conglomerate has an extensive portfolio of proprietary products covering security and industry, transportation, electronics, and the consumer sector.