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3M plans 500 more layoffs
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August 27, 1998: 10:46 a.m. ET
Firm sets $500M restructuring charge, may sell units due to Asia, strong dollar
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NEW YORK (CNNfn) - Following a series of earnings disappointments, Minnesota Mining & Manufacturing Co. said Thursday it will slash some 4,500 jobs, consolidate operations, and possibly divest non-core business units.
Last month, 3M said layoffs would be closer to 4,000.
The restructuring plan, designed to step up productivity and better insulate 3M from global economic pressures, should enable the company to record double-digit earnings growth for the coming three years, Chairman and Chief Executive L.D. DeSimone said.
DeSimone told analysts sales will continue to be hurt by the economic instability in Asia, but still are expected to grow an average of 8 percent per year.
3M will take a $500 million pre-tax charge to cover the costs of severance packages and consolidation. Layoffs should be complete by the end of next year.
"We're taking the right actions to strengthen our earnings growth as quickly as possible and we remain committed to continued investment in our growth platforms,'' DeSimone said.
A company spokeswoman said 1,500 of the layoffs will come from attrition and a hiring freeze this year.
She said 3M is exploring its options for non-core and underperforming business units that might include the sale of those companies or the creation of a joint venture.
St. Paul, Minn.-based 3M, which manufactures a range of products including Scotch tape and Post-It Notes, recorded 1997 sales of $15 billion and net income of $1.6 billion.
Last month, 3M said it would cut 4,000 jobs in a bid to fend off anticipated losses due to the Asian crisis, a slowdown in economic growth, and a strong U.S. dollar.
The announcement came as 3M reported a nearly 8 percent decline in second-quarter earnings.
Shares of 3M (MMM) were off 3/16 at 73-15/16 on the New York Stock Exchange Thursday morning following the news. 
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