Minnesota Mining & Manufacturing to buy Robinson Nugent Inc. for 1.24 times revenue

Weekly Corporate Growth Report, Oct 16, 2000

The Deal: Minnesota Mining & Manufacturing has agreed to purchase Robinson Nugent Inc. for $115 million in stock and assumed debt. The acquisition is an effort to add Internet router connectors to its Interconnect business. After the news of the transaction was announced, shares of 3M rose $2.31 to $94, while Robinson shares jumped up $1.69 to close at $18.31.

Discussion: Robinson Nugent Inc. makes circuit sockets and connectors that join integrated circuits to printed circuit boards. Its products, which are sold under such brands as METPAK and PAK, and are found in telecommunications networking and switching equipment, computers, workstations, disk drives, industrial controls and other electronics. Robinson Nugent also provides engineering assistance, design and manufacturing of custom products. Subsidiary Cablelink makes custom cable assemblies.

Minnesota Mining & Manufacturing Co. (3M) operates six divisions: industrial (advanced adhesives, tapes and abrasives), transportation, graphics and safety (reflective materials, respirators and optical films), health care (drugs, dental and skin products), consumer and office (tape), electro and communications (insulating products) and specialty material (gases and plastics). Well-known brands include Scotchgard fabric protectors, Post-it Notes, Scotch-Brite scouring products and Scotch tapes. The company operates in more than 60 countries, and international operations account for nearly 60 percent of sales.