Worthington Steel (WS) investor relations material

Deal rationale and strategic fit

• Creates the second largest service center in North America, expanding product offerings, geographic reach, and diversifying end markets to mitigate cyclicality.

• Strengthens core capabilities in carbon flat roll and electrical steel, adds aluminum, stainless, long products, plate, and downstream fabrication.

• Both companies share a focus on safety, operational excellence, innovation, and disciplined execution, with strong cultural alignment to support integration.

• The deal is transformational, providing step-change growth, opening new opportunities, and supporting further industry consolidation.

• Fits a deliberate strategy to target well-run, EPS-accretive businesses that improve EBITDA margin quality.

Financial terms and conditions

• All-cash acquisition via a voluntary public tender offer in Germany at €11 per share, implying a $2.4 billion enterprise value.

• Transaction multiples: ~8.5x TTM EBITDA pre-synergies, ~5.5x with $150M synergies.

• Fully financed with committed facilities, no financing conditions, and bridge financing from Wells Fargo and Citigroup.

• Pro forma net leverage expected at ~4.0x at closing, with a plan to reduce below 2.5x within 24 months.

• Minimum acceptance threshold of 65% required, with 42% already committed by the largest shareholder.

Synergies and expected cost savings

• $150 million in annual run-rate synergies targeted by fiscal 2028, with about 50% achievable in year one, mainly from procurement, logistics, and overhead.

• Synergies from procurement ($55M), operational efficiency ($30M), process ($40M), and SG&A reduction ($25M).

• Over 95% of synergies expected from North American operations due to overlapping suppliers, customers, and facilities.

• One-time cost to achieve synergies estimated at $40 million.

• Integration Management Office established to drive synergy capture using a transformation approach.