3M launches split exchange offer for food safety business

ST. PAUL, Minnesota – 3M announced the launch of an exchange offer to spin off its food safety business in the previously announced Reverse Morris Trust transaction with Neogen Corporation through the merger of Garden SpinCo Corporation, currently a wholly owned subsidiary of 3M Creation to hold the food safety business, along with a subsidiary of Neogen.

Key elements of the exchange offer include:

  • 3M stockholders have the option to exchange some, all or none of their 3M common stock for SpinCo common stock, subject to the proration described below. The common shares of SpinCo will automatically convert into the right to receive common shares of Neogen upon closing of the merger, which is expected to occur shortly after completion of the exchange offer.
  • Tendering 3M shareholders are expected to receive approximately $107.53 of Neogen common stock for each $100.00 of 3M common stock tendered and accepted under the exchange offer, subject to the upper limit described below.
  • 3M will determine the prices at which 3M common stock and SpinCo common stock (and ultimately Neogen common stock) will trade by reference to the simple arithmetic mean of the daily volume-weighted average prices of 3M common stock on the New York Stock Exchange and shares of Neogen common stock on the Nasdaq Global Select Market on each of the last three full trading days ending on the second full trading day prior to the expiration date of the exchange offer (which are currently expected to be August 25, August 26 and August 29, 2022).
  • 3M currently expects approximately 108.3 million shares of SpinCo common stock to be available under the exchange offer, with the final number dependent on the number of outstanding Neogen common shares immediately outstanding. prior to the closing of the merger. The number of shares of 3M common stock that will be accepted under the exchange offer will depend on the final exchange ratio, the number of shares of SpinCo common stock tendered and the number of shares of 3M common stock tendered. Based on recent trading prices of 3M common stock and Neogen common stock, and assuming the issuance of 108.3 million shares of SpinCo common stock, if the exchange offer were fully subscribed for, approximately 15.7 million shares of 3M common stock would be accepted for exchange in the exchange offer.
  • The exchange offer and withdrawal rights shall expire at 11:59 p.m., New York City time, on August 31, 2022, unless the exchange offer is extended or terminated.

The exchange offer is designed to allow 3M shareholders to exchange all or a portion of their 3M common stock for SpinCo common stock (which will be converted into Neogen common stock) at a discount of 7% per share value of Neogen common stock, subject to an upper limit of 7.3515 SpinCo common stock per 3M common stock.

The common shares of SpinCo will not be transferred to participants in the exchange offer. Immediately upon completion of the Exchange Offer, a subsidiary of Neogen will be merged with and into SpinCo and SpinCo will become a wholly owned subsidiary of Neogen. Following the merger, each common share of SpinCo (except for certain excluded shares) will be converted into one common share of Neogen. No separate commercial market currently exists or will exist for the common shares of SpinCo.

The aggregate number of Neogen common shares to be issued pursuant to Neogen’s proposed transaction will result in holders of SpinCo common shares prior to the completion of the proposed transaction collectively owning approximately 50.1% of the common shares in outstanding of Neogen and holders of common stock of Neogen prior to the completion of the proposed transaction holding approximately 49.9% of the outstanding shares.

3M will announce the final exchange ratio used to determine the number of shares of SpinCo common stock that 3M stockholders participating in the exchange offer will receive for each share of 3M common stock accepted in the exchange, as well as whether the limit will be effective, via www.3mneogenexchange.com and by press release, no later than 11:59 p.m., New York time, on the second full trading day prior to the expiration date of the exchange offer (currently scheduled August 29, 2022, unless the exchange offer is terminated or extended).

The exchange offer will expire at 11:59 p.m., New York time, on August 31, 2022, unless terminated or extended, and the closing of the Neogen subsidiary’s merger with and into SpinCo is expected to occur promptly following the completion of the offer. exchange. The transactions are subject to customary closing conditions, including Neogen shareholder approval. Neogen has scheduled a special meeting of shareholders to be held on August 17, 2022 to approve the issuance of common shares of Neogen in connection with the proposed transaction and certain other proposals related to the transaction. The number of outstanding common shares of 3M will be reduced following the exchange offer if the exchange offer is consummated.

The exchange offer will be pro-rated if the exchange offer is oversubscribed, and the number of 3M common shares accepted in the exchange offer may be less than the number of 3M common shares tendered.

If the exchange offer is consummated but not fully subscribed, 3M will distribute the remaining shares of SpinCo common stock held by 3M on a pro rata basis to 3M stockholders whose shares of 3M common stock remain outstanding after the closing of the offer. exchange, with a record date expected to be close of business on August 31, 2022.

If the exchange offer is terminated by 3M without an exchange of shares (but the conditions to complete the proposed transaction have otherwise been satisfied), 3M intends to distribute all of the common shares of SpinCo held by 3M on a pro rata basis to holders of 3M common stock, with a record date to be announced by 3M.

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