HNI Corp and Steelcase to Merge, SCS Shareholders to Own 36% of Combined Company

Steelcase Inc. (NYSE:SCS) is merging with HNI Corp (HNI), with SCS shareholders owning 36% of the combined company. The merger makes sense and SCS shareholders will receive $7.2/share in cash as part of the exchange. Middle Coast Investing highlighted SCS as a major position, but the firm does not plan to sell its shares in the near future.

Steelcase Inc. (NYSE:SCS) and HNI Corp. (HNI) are on track to finalize a merger that will create a significant player in the office furniture industry. The acquisition, valued at approximately $2.2 billion, is expected to close in the fourth quarter of 2025, pending shareholder and regulatory approvals Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1].

In the second quarter of 2025, Steelcase reported a 5% revenue growth, driven by strong demand from large corporate customers, which offset a decline in education sales. The company's net income declined to $35 million from $63.1 million, but adjusted earnings per share rose to 45 cents from 39 cents Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1].

As part of the merger, SCS shareholders will own 36% of the combined company and will receive $7.20 per share in cash Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1]. Middle Coast Investing has highlighted SCS as a major position but does not plan to sell its shares in the near future Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1].

HNI has taken a key financing step in the merger by announcing an exchange offer for any and all of Steelcase’s outstanding $450 million in 5.125% senior notes due 2029. The offer allows noteholders to exchange their Steelcase debt for new HNI notes with the same coupon, maturity, and interest dates Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1]. Investors who tender before the early deadline will receive additional cash payments, while those who tender after the early date will receive fewer new notes Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1].

The merger comes at a time when tariffs and inflation are putting pressure on margins for both companies. Steelcase's gross margin slipped slightly to 34.4% in the second quarter, as tariff costs and inflation weighed on results. However, the company has implemented pricing actions to offset much of the impact Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1].

Steelcase leadership remains optimistic about the future, citing strong momentum with corporate customers and the potential to recover from tariff-driven downsides under the HNI merger Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1]. The combined company is expected to generate roughly $5.7 billion in 2024 net sales on a pro forma basis Steelcase rides rebound as HNI merger nears, but tariffs still bite^[1].