Worthington Industries, Inc. (“Worthington Industries” or the
“Company”) (NYSE: WOR), a leading industrial manufacturer, today
announced that its Board of Directors (the “Board”) approved the
previously announced separation of its Steel Processing business,
Worthington Steel, Inc. (“Worthington Steel”) via a spin-off that
is generally intended to be tax-free to shareholders for U.S.
federal income tax purposes. The Board declared a pro rata
distribution of 100% of the outstanding common shares of
Worthington Steel to Worthington Industries shareholders of record
as of the close of business on November 21, 2023 (the “Record
Date”). The distribution is expected to be payable prior to market
open on December 1, 2023 (“Distribution Date”). As a result of the
distribution, Worthington Industries shareholders will receive one
common share of Worthington Steel for every one common share of
Worthington Industries they hold on the Record Date. No action is
required by Worthington Industries shareholders to receive the
distributed common shares of Worthington Steel.
The Company expects “when-issued” trading of Worthington Steel
common shares to begin on November 28, 2023, on the New York Stock
Exchange (“NYSE”), under the symbol “WS WI.” The “when-issued”
trading market is a market for the yet-to-be-issued Worthington
Steel common shares that will be distributed to holders of
Worthington Industries on the Distribution Date. Shareholders who
own Worthington Industries common shares at the close of business
on the Record Date will be entitled to receive shares of
Worthington Steel in the distribution, but they can trade this
entitlement separately from their Worthington Industries common
shares in the “when-issued” market. “Regular-way” trading of
Worthington Steel common shares is expected to begin on the NYSE on
December 1, 2023, under the symbol “WS.” On December 1, 2023,
Worthington Industries will also be renamed Worthington
Enterprises, Inc. and will continue to trade on the NYSE under the
ticker symbol “WOR.”
Worthington Steel
Following the planned separation, Worthington Steel will be a
market-leading steel processor and producer of electrical steel
laminations and automotive lightweighting solutions. Worthington
Steel expects to maintain a strong balance sheet and continue its
balanced approach to capital allocation. In addition to attractive
growth opportunities through strategic capital investments,
Worthington Steel will be well-positioned to capitalize on growth
opportunities from the anticipated global shift toward electrified
vehicles.
“This is an exciting step toward Worthington Steel’s launch as
an independent company,” said Geoff Gilmore, executive vice
president and chief operating officer, Worthington Industries, and
the future chief executive officer of Worthington Steel. “Our
sharpened strategic focus is expected to fuel our growth in the
electrification, sustainability and infrastructure markets, and we
look forward to capitalizing on new growth opportunities as a
standalone organization.”
Worthington Enterprises
Following the planned separation, Worthington Enterprises will
be a market-leading designer and manufacturer of innovative
Building Products, Consumer Products and Sustainable Energy
Solutions. As a more focused company, Worthington Enterprises will
be well-positioned to capitalize on key trends in sustainability,
technology, remodeling and construction and outdoor living.
Worthington Enterprises will continue to pursue a growth strategy
focused on leveraging its robust new product pipeline of
innovative, sustainable, tech-enabled solutions to disrupt mature
markets.
Andy Rose, president and chief executive officer, Worthington
Industries, and future chief executive officer of Worthington
Enterprises, said, “Today’s announcement marks one of the final
milestones for our planned separation of Steel Processing, as we
turn one great company into two. We look forward to completing this
transaction as we build on our shared legacy and create two
distinct, market-leading companies with strong cash flows and
compelling growth opportunities.”
Additional Information About the
Distribution
Worthington Industries shareholders who hold Worthington
Industries common shares on the Record Date will either receive a
book-entry account statement reflecting their ownership of
Worthington Steel common shares, or their brokerage account will be
credited with Worthington Steel shares, without any further action.
The shares are expected to be credited to “street name”
shareholders through the Depository Trust Corporation (DTC) on the
Distribution Date.
Fractional common shares of Worthington Steel will not be
distributed to Worthington Industries shareholders. Instead, the
fractional common shares of Worthington Steel will be aggregated
and sold in the open market, with the net proceeds distributed pro
rata in cash payments to the Worthington Industries shareholders
who otherwise would have received fractional common shares of
Worthington Steel.
An information statement containing details regarding the
distribution of Worthington Steel common shares and Worthington
Steel’s business and management following the consummation of the
distribution will be mailed to Worthington Industries shareholders
prior to the Distribution Date. The distribution of Worthington
Steel common shares remains subject to the satisfaction or waiver
of customary conditions, including the Securities and Exchange
Commission (“SEC”) having declared effective Worthington Steel’s
Registration Statement on Form 10, as amended, which Worthington
Steel has filed with the SEC and is available at the SEC’s website
at http://www.sec.gov, as described in the information
statement.
Holders of Worthington Industries common shares are encouraged
to consult with their financial advisors regarding the specific
implications of selling Worthington Industries common shares on or
before the Distribution Date.
For U.S. federal income tax purposes, U.S. shareholders of
Worthington Industries (other than those subject to special rules)
are generally not expected to recognize gain or loss as a result of
the distribution, except with respect to cash received in lieu of
fractional common shares of Worthington Steel. Worthington
Industries shareholders are urged to consult with their tax
advisors with respect to the U.S. federal, state and local or
foreign tax consequences, as applicable, of the distribution.
WOR Trading Information
Worthington Industries common shares will continue to trade
“regular way” on the NYSE under the symbol “WOR” through the
Distribution Date. Worthington Industries expects that beginning
November 28, 2023, there will be two markets in Worthington
Industries common shares on the NYSE: “regular-way” under the
symbol “WOR” and “ex-distribution” under the symbol “WOR WI.” Prior
to the Distribution Date, Worthington Industries common shares that
trade in the “regular-way” market will trade with the right to
receive common shares of Worthington Steel on the Distribution
Date. Common shares of Worthington Industries that trade in the
“ex-distribution” market will trade without the right to receive
common shares of Worthington Steel on the Distribution Date and
will reflect the name change to Worthington Enterprises.
About Worthington Industries
Worthington Industries (NYSE:WOR) is a leading industrial
manufacturing company pursuing its vision to be the transformative
partner to its customers, a positive force for its communities and
earn exceptional returns for its shareholders. For over six
decades, the Company has been delivering innovative solutions to
customers spanning industries such as automotive, energy, retail
and construction. Worthington Industries is North America’s premier
value-added steel processor and producer of laser welded solutions
and electrical steel laminations that provide lightweighting,
safety critical and emission reducing components to the mobility
market. Through on-board fueling systems and gas containment
solutions, Worthington Industries serves the growing global
hydrogen ecosystem. The Company’s focus on innovation and
manufacturing expertise extends to market-leading consumer products
in tools, outdoor living and celebrations categories, sold under
brand names, Coleman®, Bernzomatic®, Balloon Time®, Level5 Tools®,
Mag Torch®, Well-X-Trol®, General®, Garden-Weasel®, Pactool
International® and Hawkeye™; as well as market leading building
products, including water systems, heating & cooling solutions,
architectural and acoustical grid ceilings and metal framing and
accessories.
Headquartered in Columbus, Ohio, Worthington Industries operates
52 facilities in 15 states and nine countries, sells into over 90
countries and employs approximately 9,500 people. Founded in 1955,
the Company follows a people-first Philosophy with earning money
for its shareholders as its first corporate goal. Relentlessly
finding new ways to drive progress and transform, Worthington
Industries is committed to providing better solutions for customers
and bettering the communities where it operates by reducing waste,
supporting community-based non-profits and developing the next
generations of makers.
Safe Harbor Statement
The Company wishes to take advantage of the Safe Harbor
provisions included in the Private Securities Litigation Reform Act
of 1995 (the “Act”). Statements by the Company relating to the
intended separation of Worthington Steel; the timing and method of
the separation; the anticipated benefits of the separation; the
expected financial and operating performance of, and future
opportunities for, each company following the separation; the tax
treatment of the transaction; the leadership of each company
following the separation; and other non-historical matters
constitute “forward-looking statements” within the meaning of the
Act. Forward-looking statements may be characterized by terms such
as “believe,” “anticipate,” “should,” “would,” “intend,” “plan,”
“will,” “expect,” “estimate,” “project,” “positioned,” “strategy,”
“targets,” “aims,” “seeks,” “sees” and similar expressions. Because
they are based on beliefs, estimates and assumptions,
forward-looking statements are inherently subject to risks and
uncertainties that could cause actual results to differ materially
from those projected. Any number of factors could affect actual
results, including, without limitation, the final approval of the
separation by our board of directors; the uncertainty of obtaining
regulatory approvals in connection with the separation, including
rulings from the Internal Revenue Service; the ability to satisfy
the necessary closing conditions to complete the separation on a
timely basis, or at all; our ability to successfully separate the
two companies and realize the anticipated benefits of the
separation; the risks, uncertainties and impacts related to the
COVID-19 pandemic - the duration, extent and severity of which is
impossible to predict, including the possibility of future
resurgence in the spread of COVID-19 or variants thereof - and the
availability, effectiveness and acceptance of vaccines, and other
actual or potential public health emergencies and actions taken by
governmental authorities or others in connection therewith; the
effect of national, regional and global economic conditions
generally and within major product markets, including significant
economic disruptions from COVID-19, the actions taken in connection
therewith and the implementation of related fiscal stimulus
packages; the effect of conditions in national and worldwide
financial markets, including inflation and increases in interest
rates, and with respect to the ability of financial institutions to
provide capital; the impact of tariffs, the adoption of trade
restrictions affecting the Company’s products or suppliers, a
United States withdrawal from or significant renegotiation of trade
agreements, the occurrence of trade wars, the closing of border
crossings, and other changes in trade regulations or relationships;
changing oil prices and/or supply; product demand and pricing;
changes in product mix, product substitution and market acceptance
of the Company’s products; volatility or fluctuations in the
pricing, quality or availability of raw materials (particularly
steel), supplies, transportation, utilities, labor and other items
required by operations (especially in light of COVID-19 and
Russia’s invasion of Ukraine); the outcome of adverse claims
experience with respect to workers’ compensation, product recalls
or product liability, casualty events or other matters; effects of
facility closures and the consolidation of operations; the effect
of financial difficulties, consolidation and other changes within
the steel, automotive (especially in light of the semi-conductor
shortages), construction and other industries in which the Company
participates; failure to maintain appropriate levels of
inventories; financial difficulties (including bankruptcy filings)
of original equipment manufacturers, end-users and customers,
suppliers, joint venture partners and others with whom the Company
does business; the ability to realize targeted expense reductions
from headcount reductions, facility closures and other cost
reduction efforts; the ability to realize cost savings and
operational, sales and sourcing improvements and efficiencies, and
other expected benefits from transformation initiatives, on a
timely basis; the overall success of, and the ability to integrate,
newly-acquired businesses and joint ventures, maintain and develop
their customers, and achieve synergies and other expected benefits
and cost savings therefrom; capacity levels and efficiencies,
within facilities, within major product markets and within the
industries in which the Company participates as a whole; the effect
of disruption in the business of suppliers, customers, facilities
and shipping operations due to adverse weather, casualty events,
equipment breakdowns, labor shortages (especially in light of the
COVID-19 pandemic), interruption in utility services, civil unrest,
international conflicts, terrorist activities or other causes;
changes in customer demand, inventories, spending patterns, product
choices, and supplier choices; risks associated with doing business
internationally, including economic, political and social
instability (especially in light of Russia’s invasion of Ukraine),
foreign currency exchange rate exposure and the acceptance of the
Company’s products in global markets; the ability to improve and
maintain processes and business practices to keep pace with the
economic, competitive and technological environment; the effect of
inflation and interest rate increases, which may negatively impact
the Company’s operations and financial results; deviation of actual
results from estimates and/or assumptions used by the Company in
the application of its significant accounting policies; the level
of imports and import prices in the Company’s markets; the impact
of environmental laws and regulations or the actions of the United
States Environmental Protection Agency or similar regulators which
increase costs or limit the Company’s ability to use or sell
certain products; the impact of increasing environmental,
greenhouse gas emission and sustainability regulations; the impact
of judicial rulings and governmental regulations, both in the
United States and abroad, including those adopted by the United
States Securities and Exchange Commission (“SEC”) and other
governmental agencies as contemplated by the Coronavirus Aid,
Relief and Economic Security (CARES) Act, the Consolidated
Appropriations Act, 2021, the American Rescue Act of 2021, and the
Dodd-Frank Wall Street Reform and the Consumer Protection Act of
2010; the effect of healthcare laws in the United States and
potential changes for such laws, especially in light of the
COVID-19 pandemic which may increase the Company’s healthcare and
other costs and negatively impact the Company’s operations and
financial results; the effect of tax laws in the U.S. and potential
changes for such laws, which may increase the Company’s costs and
negatively impact its operations and financial results; cyber
security risks; the effects of privacy and information security
laws and standards; and other risks described from time to time in
the filings of Worthington Industries, Inc. with the SEC, including
those described in “Part I - Item 1A. - Risk Factors” of the
Company’s Annual Report on Form 10-K for the fiscal year ended May
31, 2023, and its subsequent filings with the SEC. Forward-looking
statements should be construed in the light of such risks. Readers
are cautioned not to place undue reliance on any forward-looking
statements, which speak only as of the date made. Worthington does
not undertake, and hereby disclaim, any obligation to update any
forward-looking statements, whether as a result of new information,
future developments or otherwise.
Contacts:SONYA L. HIGGINBOTHAMVP,
CORPORATE COMMUNICATIONS AND BRAND
MANAGEMENT614.438.7391 | sonya.higginbotham@worthingtonindustries.com
MARCUS A. ROGIERTREASURER AND
INVESTOR RELATIONS OFFICER614.840.4663 |
marcus.rogier@worthingtonindustries.com
200 Old Wilson Bridge Rd. | Columbus, Ohio 43085WorthingtonIndustries.com
Worthington Enterprises (NYSE:WOR)
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