On January 24, 2024, the Board of Directors of Mativ Holdings, Inc. unanimously approved an organizational realignment plan (Plan) that is expected to streamline organizational size and complexity and leverage business-critical resources to enhance customer support. As part of the Plan, the company plans to reorganize into the following two new segments starting in the first quarter of 2024: Filtration & Advanced Materials, focused primarily on filtration and protective solutions end markets, and Sustainable & Adhesive Solutions, focused primarily on the release liners, industrials, healthcare, and packaging and specialty papers end markets. The Company also intends to reduce its workforce, indexed toward senior levels of the organization, with most of these actions expected to be executed in the first quarter of 2024 (RIF).

Decisions regarding the elimination of positions as well as the timing of separations are subject to local law and consultation requirements in certain countries, as well as the Company?s business needs. Once these initial organizational design changes contemplated by the Plan are fully executed, the Company expects to achieve an annualized run-rate of $20 million of overhead cost reduction in 2024. The company estimates that it will incur approximately $15 million to $20 million in restructuring and restructuring-related charges in 2024 in connection with the Plan, consisting primarily of employee severance payments and other termination benefits, which are expected to be incurred predominantly in the first half of 2024.

The foregoing estimated amounts do not include any non-cash charges associated with equity-based compensation. The company expects future initiatives under the Plan to include system integrations, further restructuring and transactional efficiencies, resulting in an additional $20 million in overhead cost reduction by the end of 2026. In total, the Company expects to reduce overhead costs by approximately 15%.

At this time, the Company cannot reasonably estimate these charges, total costs or an estimated range of total costs associated with these future initiatives.