Worthington Steel Plans to Offer $900M Senior Secured Notes

Worthington Steel announced that WS Escrow intends to offer, subject to market conditions and other factors, $900M aggregate principal amount of senior secured notes due 2033. Worthington Steel intends to use the net proceeds from the proposed Offering, together with borrowings under a new term loan credit facility, to fund the consideration and other payments in connection with Worthington Steel's pending acquisition of Kloeckner & Co, to fund loans to Kloeckner pursuant to a shareholder loan, to fund share purchases and other compensation to remaining minority Kloeckner shareholders in connection with the Kloeckner Acquisition, to pay transaction fees and expenses related to the foregoing, to repay certain existing indebtedness of Worthington Steel and Kloeckner and for general working capital purposes of Worthington Steel and its subsidiaries. The Offering is not conditioned on the consummation of the Kloeckner Acquisition. If the Kloeckner Acquisition is not expected to be consummated within three business days of the closing of the Offering, the Escrow Issuer will issue the Notes and will deposit the net proceeds of the Offering into an escrow account for the benefit of the holders of the Notes until the date on which certain escrow release conditions are satisfied. If the Kloeckner Acquisition is expected to be consummated within three business days of the closing of the Offering, then Worthington Steel may elect to issue the Notes directly, rather than through the Escrow Issuer, and the net proceeds will not be deposited into escrow. If the Acquisition is not consummated by March 12, 2027 or upon the occurrence of certain other events, the Notes will be subject to a special mandatory redemption at a price equal to 100% of the issue price of the Notes, plus accrued and unpaid interest to, but not including, the date of the special mandatory redemption.