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Acquisitions and Divestitures
9 Months Ended
Sep. 30, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Acquisitions and Divestitures Acquisitions and Divestitures
Acquisitions
The Company had no acquisitions during the three and nine months ended September 30, 2025 or 2024.
Divestitures
On February 25, 2025, the Company entered into a Transaction Agreement to sell its Purification and Filtration business to Thermo Fisher Scientific Inc. ("Buyer"). On June 25, 2025, the Company and Buyer entered into an Amended and Restated Transaction Agreement (the "Agreement") to exclude the Company’s drinking water filtration business (the "Water Business") from the scope of the Purification and Filtration business to be acquired by Buyer (such acquired business, the "Business").
On September 1, 2025, Solventum completed the sale of the Business to the Buyer. The cash consideration paid to Solventum at closing was approximately $4 billion, which is subject to further working capital adjustments, resulting in a pre-tax gain of approximately $1.5 billion. The pre-tax gain was recorded net of transaction fees of $86 million.
Under the Agreement, Buyer is entitled to receive a payment of up to $75 million from the Company either upon a sale of the Water Business or after an agreed upon 3-year period. The Company recorded $64 million within the other liabilities on the condensed consolidated balance sheets, which was the present value of the expected future obligation at close of the Transaction.
In connection with the sale of the Business, the Company entered into various transition service agreements to provide certain support services at cost, below fair market value, for a period of up to 24 months from the closing of the sale. These transition services include product distribution and supply chain management, contract manufacturing, information technology, finance, customer support, among others. In connection with these agreements, the Company recognized an unfavorable contract liability of $113 million, which will be recognized over the terms of the agreements.
In September 2025, the Company recognized approximately $14 million of transition service income, including amortization of the unfavorable contract liability, within selling, general and administrative expenses on the Company's condensed consolidated statements of income. Sales and cost of sales associated with products sold to Buyer, as well as cost of products purchased from Buyer under the supply agreements were not material.
Immediately following the closing, the Company repurchased inventory from Buyer to fulfill its product distribution services under the transition agreement with Buyer. The Company recorded $83 million within other current liabilities on the condensed consolidated balance sheets related to this repurchase that the Company expects to pay in the fourth quarter of 2025.