SunCoke Energy (SXC) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition of Phoenix Global for $325 million expands and diversifies the customer base, including electric arc furnace operators and international markets, enhancing service offerings and global footprint.

• Provides mission-critical, site-based services to steel mills, strengthening the role in the steel value chain and offering comprehensive mill services.

• Offers multiple paths for organic growth and increased shareholder value by leveraging operational and technical expertise.

• Phoenix's long-term, fixed-revenue contracts are insulated from commodity price volatility, supporting predictable capital planning.

• Enhances offerings to both integrated and EAF steelmaking customers, providing a platform for further expansion.

Financial terms and conditions

• Purchase price is $325 million on a cash-free, debt-free basis, at a 5.4x multiple of $61 million LTM adjusted EBITDA as of March 31, 2025.

• Funded through cash on hand and up to $230 million from a $350 million revolver, with no new debt issuance.

• Pro forma gross leverage expected at 2.62x, net leverage at 2.35x, both below the long-term target of 3x.

• Transaction expected to be immediately accretive.

Synergies and expected cost savings

• Anticipated $5–$10 million in annual synergies from corporate redundancies and operational efficiencies.

• Corporate synergies expected immediately upon closing; operational synergies to follow after integration.

• Synergies are not included in the pro forma adjusted EBITDA calculation.