Troubled data-storage company Imation has sold its corporate headquarters along with two trademark licenses and is pulling up stakes in Minnesota, two decades after being spun off from 3M.
The moves are part of the Oakdale company's continued efforts to restructure and sell off underperforming legacy businesses in DVDs, magnetic tape and consumer electronics and concentrate on business-based storage and security.
In a regulatory filing Friday, Imation said it has sold its headquarters to the owners of Slumberland Inc., for $11.5 million, but will maintain a small office there as it winds down operations. The bulk of its operations will be centered in Thousand Oaks, Calif., home base for Nexsan Solutions, which Imation bought in 2013 to help provide storage and data for cloud computing.
Imation also announced it has sold its most recognized brand, Memorex, along with two other trademark licenses, to St. Louis-based branded consumer electronics company DPI Inc. for $9.4 million.
Interim CEO Bob Fernander said in a statement that Imation is on track to complete restructuring of its legacy businesses in the first quarter of this year.
The $20 million influx enhances the company's balance sheet, but there's still a ways to go to convince investors.
"Profitability is still a goal that's not yet in their sight," said Eric Martinuzzi, an analyst with Lake Street Capital Markets in Minneapolis.
"This closes one chapter and really helps focus the business," he added. "Anytime you're shedding 85 percent of revenue and concentrating on the other 15, that will naturally focus your efforts. There was a lot of wasted effort."
Imation, Minnesota's 39th-largest publicly traded company, was formed in 1996 as a way to store computerized data separately from computers for added protection and security. It became known for its photo film, cassette tapes, floppy disks and CDs — products that became obsolete as magnetic tape technology gave way to digital and cloud-based storage.
Imation struggled mightily to gain a lasting foothold in an ever-shifting business. Its purchase of Memorex in 2006 for $330 million was a poorly timed and expensive move from which it never recovered.
Last year, the company lost $107 million on revenue of $729.5 million. Activist investors took control of the board in May, determined to diversify beyond its historical focus on "blank media" for businesses and consumers.
In October, Imation laid off at least 124 employees at its headquarters and got rid of four key executives, including its CEO and CFO. It also announced that it would close two key data storage divisions and that it planned to sell properties in Chile, London and Canada.
The restructuring plan will result in financial charges of up to $160 million. Going forward, interim President Barry Kasoff said Imation will focus on its newly acquired and growing data storage and data security firms IronKey and Nexsan.
Analysts have long noted that Imation's new vision has yet to convince investors that it will succeed long term.
The stock, which peaked around $46 after the acquisition of Memorex a decade ago, has consistently bobbed along the seafloor. Since the board coup in May, the stock plunged from $4.72 a share to $1.24 per share.