MRC Global (MRC) M&A Announcement summary

Deal rationale and strategic fit

• Merger creates a premier energy and industrial solutions provider with expanded global reach, scale, and complementary offerings across key U.S. and international hubs.

• Diversifies business portfolio, serving energy, gas utility, industrial, alternative energy, and AI infrastructure sectors.

• Greatly increases scale and scope, reducing reliance on any single sector and enhancing resilience.

• Combines and enhances product portfolios, offering broader solutions and industry-specific expertise.

• Shared vision focused on innovation, operational excellence, and customer-centricity.

Financial terms and conditions

• All-stock transaction with a combined enterprise value of approximately $3 billion, including MRC's net debt.

• MRC Global shareholders receive 0.9489 DNOW shares per MRC share; post-close ownership: DNOW 56.5%, MRC 43.5%.

• Board expands to 10 directors, including two from MRC Global.

• Over $200 million in cash and a $500 million revolving credit facility, with an additional $250 million commitment at close.

• Expected pro forma net leverage of under 0.5x at close, with a net cash position anticipated by the end of the first year post-closing.

Synergies and expected cost savings

• $70 million in annual run rate pre-tax synergies targeted within three years post-close.

• Synergies sourced from corporate/IT (50%), public company costs (23%), and operational/supply chain efficiencies (27%).

• $17 million in synergies expected in year 1, $42 million in year 2, and $70 million by year 3.

• No revenue synergies included in the model yet; focus is on cross-selling and leveraging complementary strengths.

• Double-digit adjusted EPS accretion anticipated in the first year after closing.