Combined company forecast to generate annual revenue of $3.1B
Southern Indiana Business Report
JASPER – HNI Corporation (NYSE: HNI) and Kimball International Inc. (NASDAQ: KBAL) announced Wednesday that they have entered into a definitive agreement under which HNI will acquire all the outstanding shares of Kimball International in a cash and stock transaction valued at approximately $485 million.
Under the terms of the agreement, Kimball International shareholders will receive $9 in cash and 0.1301 shares of HNI common stock for each share of Kimball International common stock they own. As a result of the transaction, Kimball International shareholders will own approximately 10% of the combined company.
“We are excited about joining with Kimball International, a high-quality company we have long admired for its recognized brands, furnishings expertise built over 70 years, and established relationships across multiple sectors. The combined company will have a stronger platform for growth, delivering significant benefits for our shareholders, members, dealers, and customers. We look forward to welcoming the talented Kimball International employees to HNI,” said Jeff Lorenger, HNI’s chairman, president, and chief executive officer.
Based in Jasper, Kimball International is a commercial furnishings company with a well-established family of brands and extensive expertise in the workplace, health and hospitality segments. HNI and Kimball International share similar cultures and values with a commitment to customer service and operational excellence. In addition, both companies have strong brand positions and complementary product portfolios.
A combined HNI and Kimball International will have a broader, more comprehensive product offering, tailored go-to-market strategies, and enhanced manufacturing capabilities. Kimball International’s strong presence in secondary geographic areas and expertise in ancillary products will enable the combined company to better benefit from post-pandemic trends in the fastest growing markets.
Kristie Juster, Kimball International’s CEO said, “I’m incredibly proud of what we have built at Kimball International, and this agreement is a testament to our team’s commitment and dedication. Joining HNI is an important next step in our company’s history and will provide our employees with more opportunities for career growth and development as part of a larger, more diversified industry leader that also shares our deeply rooted values. We are confident that combining with HNI represents the ideal fit for our family of brands and will deliver enhanced value to all stakeholders.”
Following the close of the transaction, the combined company will continue to be led by Lorenger. Juster will remain in her current role with Kimball International until the closing to ensure a seamless transition.
Financial profile
The combined company will have pro forma annual revenue of approximately $3.1 billion and pro forma adjusted EBITDA of approximately $290 million, inclusive of annual run-rate synergies, based on each company’s respective last reported 12 months. The combination is expected to generate $25 million of annual run-rate cost synergies within three years of closing.