HNI, an Iowa-based workplace furniture provider and residential building product manufacturer, has announced its acquisition of Steelcase, a Michigan-based manufacturer of office, hospital, and classroom furniture. The 2.2 billion USD deal will result in HNI shareholders owning 64% of the combined company, while Steelcase shareholders will own 36%. Sara Armbruster, President and CEO of Steelcase, said the merger marks a “bold step that marks the next era for Steelcase.”
According to the agreement, HNI chairman, president, and CEO Jeffrey Lorenger will lead the combined company. HNI will maintain its headquarters in Muscatine, Iowa, while Steelcase will keep its headquarters in Grand Rapids. The Steelcase brand will be retained after the transaction is closed, and HNI’s board of directors will expand to include two Steelcase independent board members. Lorenger stated that the combined company will be better positioned to meet the evolving needs of the workplace and unlock new opportunities for growth.
The merger has received mixed reviews, with some welcoming the resurgence in office space demand, while others have expressed concerns about potential job losses in Michigan. Erik Gordon, a professor at the University of Michigan’s Ross Business School, noted that the deal could impact 2,000 Michigan workers and perpetuate a decline in manufacturing jobs in the state.
Key Terms of the Deal:
– HNI shareholders will own 64% of the combined company
– Steelcase shareholders will own 36%
– HNI will maintain the Steelcase brand
– HNI’s board of directors will expand to include two Steelcase independent board members
– Jeffrey Lorenger will lead the combined company
Image Courtesy: archpaper.com
