Worthington Industries said Thursday that it will split into two public companies in a move meant to allow each company to capitalize on different growth and value creation strategies.
“The Board and management team regularly consider alternatives to unlock the value of our businesses and ensure we are best positioned to serve customers,” John McConnell, executive chairman of Worthington’s board of directors, said in a statement. “We recently re-segmented to better align each business with the attractive markets we serve, and the planned separation will further advance those efforts.”
The split is expected to be completed by early 2024.
Both businesses will continue to be headquartered in the Columbus area and likely will keep Worthington in their new corporate names, the company said. The new names will be announced before the companies are separated.
Worthington is pitching the separation as a way for each company to have a sharper focus on its markets and priorities. It said the separation will make it easier for investors to understand and value each company.
Worthington Industries CEO Andy Rose will lead one company that will focus on consumer products, building products and sustainable energy products. The company had sales of $1.3 billion for its most recent fiscal year.
Geoff Gilmore, chief operating officer officer of Worthington industries, will become CEO of the other company, a steel processor and producer of electrical steel laminations and automotive products.
That business generated $3.9 billion in sales in the most recent fiscal year.
“For nearly 70 years, we have continued my father’s legacy of operating Worthington based on a people-first philosophy, rooted in the Golden Rule, focused on driving shareholder value,” McConnell said of his father, who founded the company in 1955. “This approach has enabled us to achieve market-leading positions throughout our businesses. As Worthington plans to become two standalone public companies, these guiding principles will remain intact for both companies.”
The McConnell family is expected to continue as a meaningful, long-term shareholder of both companies.
Worthington Industries’ shares fell 10% in mid-day trading Thursday after the announcement.