American Axle Seeks $2.3 Billion to Fund Dowlais Takeover
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American Axle & Manufacturing Inc. is looking to raise $2.3 billion in the U.S. leveraged-finance market to help fund its acquisition of Dowlais Group Plc.
The auto parts maker is offering a combined $1.44 billion of junk bonds in two tranches as well as a $843 million term loan, according to people familiar with the situation who asked not to be identified as they’re not authorized to speak publicly.
Both are expected to price late this week, and JPMorgan Chase & Co. is leading the sales, the people added.
a 1.16 billion-pound ($1.6 billion) cash-and-stock deal to acquire U.K. peer Dowlais. The deal is expected to close in the fourth quarter.
AAM today announced a combination with Dowlais for $1.44 billion in cash and stock. The combination creates a leading global driveline and metal forming supplier with a comprehensive product portfolio and diversified customer base. Read more: — AAM (@AmericanAxle)
The offering is a welcome M&A financing in the leveraged-loan market. After few deals in August, just 7% of this month’s launches as of Sept. 12 were for acquisition-related funding, according to data compiled by Bloomberg. However, the junk-bond sale is part of a monthslong rush of activity helped by average yields at the lowest levels since 2022.
Written by Jeannine Amodeo and Gowri Gurumurthy
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