3M Company (“3M”) announced the commencement of an exchange offer to effect the separation of its food safety business (the “Food Safety Business”), in furtherance of the previously announced Reverse Morris Trust transaction with Neogen Corporation (“Neogen”) through the merger of Garden SpinCo Corporation (“SpinCo”), currently a wholly-owned subsidiary of 3M formed to hold the Food Safety Business, with a subsidiary of Neogen (the “Merger”).
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The exchange offer is designed to permit 3M stockholders to exchange all or a portion of their shares of 3M common stock for shares of SpinCo common stock (which will convert into shares of Neogen common stock) at a discount of 7% to the per-share value of Neogen common stock, subject to an upper limit of 7.3515 shares of SpinCo common stock per share of 3M common stock.
Shares of SpinCo common stock will not be transferred to participants in the exchange offer. Promptly following the consummation 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. As a result of the Merger, each share of SpinCo common stock (except for certain excluded shares) will be converted into one share of Neogen common stock. No separate trading market currently exists or will exist for shares of SpinCo common stock.
The aggregate number of shares of Neogen common stock to be issued in the proposed transaction by Neogen will result in holders of shares of SpinCo common stock prior to the consummation of the proposed transaction collectively owning approximately 50.1% of the outstanding shares of Neogen common stock and holders of Neogen common stock prior to the consummation of the proposed transaction owning 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 for exchange, as well as whether the upper limit will be in effect, through www.3mneogenexchange.com and by press release, no later than 11:59 p.m., New York City time, on the second full trading day prior to the expiration date of the exchange offer (currently expected to be August 29, 2022, unless the exchange offer is terminated or extended).
The exchange offer will expire at 11:59 p.m., New York City time, on August 31, 2022, unless terminated or extended, and the closing of the merger of the Neogen subsidiary with and into SpinCo is expected to occur promptly following the consummation of the exchange offer. 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 shares of Neogen common stock in the proposed transaction and certain other transaction-related proposals. The number of outstanding shares of 3M common stock will be reduced as a result of the exchange offer if the exchange offer is consummated.