3M 2012 Annual Report Download - page 29
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Operating income was $2.1 billion in 2011, 17.3 percent higher than 2010. 3M achieved operating income margins of 20.4
percent, even with continued investments to support growth.
Investment:
In March 2005, 3M’s automotive business completed the purchase of 19 percent of TI&M Beteiligungsgesellschaft mbH
(TI&M) for approximately $55 million. TI&M is the parent company of I&T Innovation Technology Entwicklungsund Holding
Aktiengesellschaft (I&T), an Austrian maker of flat flexible cable and circuitry. Pursuant to a Shareholders Agreement, 3M
marketed I&T’s flat flexible wiring systems for automotive interior applications to the global automotive market. I&T filed a
petition for bankruptcy protection in August 2006. As part of its agreement to purchase the shares of TI&M, the Company
was granted a put option that gave the Company the right to sell back its entire ownership interest in TI&M to the other
investors from whom the Company acquired its 19 percent interest. The put option became exercisable January 1, 2007.
The Company exercised the put option and recovered approximately $25 million of its investment from one of the
investors based in Belgium in February 2007. The other two TI&M investors from whom the Company purchased its
shares filed a bankruptcy petition in Austria in January 2007. The Company has recovered approximately 6.7 million
Euros through the Austrian bankruptcy process. The Company then pursued recovery from the bank that held the 3M
purchase price paid to the two bankrupt investors, and in March 2012 recovered 4.5 million Euros, leaving a balance of
7.4 million Euros (approximately $10 million). In September 2012, 3M Austria commenced proceedings in the Commercial
Court of Vienna against the co-sellers of the shares to recover the remaining balance plus accrued interest pursuant to
the terms of the Share Purchase Agreement and Austrian law. The Company believes collection of its remaining
investment is probable and, as a result, no impairment reserve has been recorded.