3M Co (MMM.N) said on Thursday it would buy Johnson Controls International Plc’s (JCI.N) safety gear business, Scott Safety, in deal with an enterprise value of $2 billion.
Scott Safety makes respiratory and protective equipment and other safety products for firefighters, industrial workers, police squads and the U.S. military.
The Monroe, North Carolina-based business’s 2016 revenue was about $570 million and would complement 3M’s personal safety business, which also manufactures safety devices, 3M said.
Johnson Controls, which manufactures products ranging from car batteries to heating equipment, had been exploring a sale of the business, Reuters had reported last week.
Proceeds from the deal are expected to be about $1.8 billion-$1.9 billion, and would be used to repay a portion of Tyco International Plc’s $4.0 billion of merger-related debt, Johnson Controls said.
Johnson Controls agreed to buy Ireland-based peer Tyco International in January last year and the merger completed in September.
3M’s financial advisers were Citi and Goldman Sachs while Centerview Partners provided financial advice to Johnson Controls.
Shares of Johnson Controls were up 1.3 percent at $42.49 and 3M’s shares edged up 0.6 percent to $192.34 in premarket trading.
Source: Reuters.com