Industrial and consumer products company 3M continues to reduce its Austin footprint, announcing plans to shed a unit based here that makes bandwidth and optical fiber devices for the telecommunications sector — six months after it reached a separate deal to sell its main local campus.
Corning is buying 3M’s communication markets division for $900 million in a cash transaction that’s expected to close next year, the two companies said Monday. The division employs 120 people in Austin and is based here, although the bulk of the unit’s 500 employees are located in Germany and France, according to a 3M spokeswoman.
M. Elizabeth Dann, a Corning spokeswoman, said the 3M division will be folded into Corning’s optical communications business once the deal closes, but said no decisions have been made as to how the integration will occur. The Corning division is based in North Carolina.
“Our first goal is to better understand the current operations and then we can determine how best to integrate,” Dann said. “Location-specific employee details are not yet available.”
Based in St. Paul, Minn., 3M is perhaps best known for Post-it notes and Scotch tape. The company currently employs about 800 people at its main, 156-acre Austin campus at RM 2222 and RM 620. It also has a manufacturing plant on Research Boulevard in North Austin, although the company didn’t provide an immediate tally of the number of employees it has there.
In June, 3M announced it had reached a deal to sell the main local campus to Austin-based World Class Capital, a private investment firm that focuses on real estate, for an undisclosed price. 3M built the campus in 1988 but said when it first put the tract on the market in 2016 that it had been using only “a portion” of it.
The sale of the campus is expected to close by the end of this year, although 3M plans to lease the facility and keep its employees there until early 2019, when it has said it will move them to a new building that it’s leasing in the Tech Ridge area of Northeast Austin.
Lori Anderson, a 3M spokeswoman, said Monday that 100 of the Austin employees in the communication markets division that is being sold to Corning work at the main Austin campus, while 20 are “non-production” employees who work at the plant.
Anderson said the sale of the division “is a portfolio management decision.” She declined to comment on 3M’s Austin plans overall, except to say that Monday’s move to shed the communication markets division and the earlier decision to sell the main campus “are unrelated.”
Corning, a New York-based materials science company best known for its Gorilla Glass used in smartphones, doesn’t currently have any operations or employees in Austin, according to its spokeswoman.
The 3M division that Corning is acquiring generates annual global sales of about $400 million, both companies said.
“This transaction expands both our global market reach and our high-bandwidth portfolio,” said Clark Kinlin, executive vice president of Corning’s optical communications unit. “As the industry’s only true end-to-end manufacturer and supplier of optical solutions, we look forward to bringing these two strong organizations together and welcoming a group of outstanding employees.”
Corning previously has said it planned to spend $1 billion to $3 billion on acquisitions to beef up its portfolio.
Ashish Khandpur, executive vice president of 3M’s electronics and energy business group, said 3M determined “after a thorough strategic review” that “this business will be well positioned with Corning.”
3M has been whittling down its Austin workforce over the past several decades. In 2015, the American-Statesman reported it had about 1,000 workers. An American-Statesman article from 2002 reported it had 1,400 employees in Austin.
Its peak Central Texas employment came in 2001, when 3M had 1,800 people based in Austin. The company has had a presence here since the 1980s.
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