Lansing’s Neogen Partners with 3M’s Food Safety Business
Neogen Corp., an international food safety company in Lansing, and 3M, a multinational conglomerate based in St. Paul, Minnesota, have entered into an agreement in which 3M will separate its food safety business and combine it with Neogen.
The combination creates a leader in the food safety industry with a comprehensive product line and a strategic focus on the category’s long-term growth opportunities. The combined company has pro forma sales of approximately $ 1 billion.
“This combination will strengthen Neogen’s position in this new era of food safety, by equipping us with an expanded product line that allows us to capitalize on our growing footprint, to reach more customers, more often, while pursuing our a history of strong and consistent growth, ”said John Adent, President and CEO of Neogen.
“The increased global focus on food safety, sustainability and global supply chain solutions present exciting opportunities for Neogen to position itself as an innovative leader at the forefront of industry growth and digitization. . We are delighted to welcome 3M’s food safety employees to the Neogen team, and we look forward to demonstrating the immense benefits of this combination to our customers, employees and shareholders.
Under the agreements, which involve a tax-free “Reverse Morris Trust” structure, existing Neogen shareholders will continue to own approximately 49.9% of the combined company, and 3M shareholders will receive approximately 50.1%. The boards of directors of both companies unanimously approved the transaction.
“Neogen and 3M share a deep commitment to quality, innovation and customer satisfaction and a long history of leadership in the industry,” said Mike Roman, president and CEO of 3M. “By combining our food safety business with Neogen, we will create an organization well positioned to capture long-term profitable growth.
“This transaction further evolves our strategy, focuses our healthcare business and benefits our stakeholders as we actively manage our portfolio to drive growth and create shareholder value. “
The combined company will have an expanded product offering in the area of food safety, in particular in the areas of indicator testing and pathogen detection, which complement Neogen’s existing microbiology lines.
It should have the scale and digital capabilities to lead the digitization of the food safety industry. Complementary product offerings combined with Neogen’s data-driven analytical approach are designed to create a solution as customers seek innovative partners to increase efficiency and improve food safety protocols.
The transaction is expected to close by the end of the third quarter of 2022, subject to approval by Neogen shareholders, receipt of required regulatory approvals and satisfaction of other customary closing conditions.
Adent and the current Neogen management team will continue to lead the combined company. The size of Neogen’s board of directors will be increased and two new independent members will be appointed by 3M, who will be appointed at closing.