Somnigroup International (SGI) investor relations material

Transaction Overview

• Acquisition valued at $2.5B, paid entirely in stock, with Leggett & Platt shareholders receiving 0.1455 shares for each share owned, resulting in about 9% ownership of the combined entity on a fully diluted basis.

• Boards of both companies unanimously approved the agreement.

• Deal expected to close by year-end 2026, pending shareholder and regulatory approvals.

• Leggett & Platt will operate as a separate business unit, maintaining its leadership and offices in Carthage, Missouri.

• Transaction is anticipated to be accretive to adjusted EPS before synergies in the first year.

Strategic Rationale and Synergy Opportunities

• Advances vertical integration, enabling closer collaboration between component engineering, mattress design, and consumer trends for accelerated innovation and consumer-centric products.

• Expands addressable market in bedding and non-bedding industries, reducing reliance on any single category or geography and lessening business volatility.

• Expected to generate $50M in annual run-rate EBITDA synergies, with $10M realized in the first year, mainly from sourcing, operations, and innovation integration.

• Builds on a 50-year partnership and strong cultural alignment, enhancing innovation and customer value.

• Strengthens North American and international presence, leveraging combined manufacturing and distribution.

Financial Impact and Capital Structure

• Combined 2025 sales projected at $11.2B and adjusted EBITDA at $1.7B.

• Acquisition expected to lower net financial leverage and increase financial flexibility, supporting expanded capital allocation.

• Leggett & Platt's 2025 adjusted EBITDA is $385M; post-synergy, expected to reach $430M, reducing acquisition multiple from 6.6x to 5.8x.

• Combined company targets leverage in the 2.0x–3.0x range.

• Robust free cash flow supports reinvestment, acquisitions, and shareholder returns.