DMC Global Rejects Non-Binding Proposal from Steel Connect

Core Viewpoint - DMC Global Inc. rejected a non-binding acquisition proposal from Steel Connect, stating that the offer undervalues the company and denies stockholders the opportunity to participate in its emerging value creation [1][2]. Group 1: Proposal Rejection Reasons - The Board determined that the Steel Connect Proposal fails to account for the turnaround potential at Arcadia, especially with the return of former president Jim Schladen, who is focusing on core operations and high-end residential products [2]. - The Proposal does not reflect the cyclical improvements at DynaEnergetics, which has made significant advancements in automation and value engineering, expected to yield benefits in the first half of 2025 [2]. - The Board believes Steel Connect has prioritized its interests over those of DMC's stockholders, proposing terms that would dilute stockholder value and allow Steel Connect to gain control without a proper premium [2]. - DMC's business is stabilizing, with expectations that fourth quarter sales and adjusted EBITDA will exceed prior guidance, and a search for a new CEO is underway [2]. - Steel Connect's initial proposal was for $16.50 per share, which has since dropped to$10.18, indicating a lack of serious engagement [2]. Group 2: Company Overview - DMC Global operates innovative, asset-light manufacturing businesses, including Arcadia, DynaEnergetics, and NobelClad, which have established leadership positions in their respective markets [5].