American Axle & Manufacturing Holdings, Inc. (AAM), has announced the successful syndication of the bridge financing to support the announced Combination with the Dowlais Group plc (Dowlais) on January 29, 2025 (the “Combination”). Prior to the Combination announcement, J.P. Morgan had exclusively underwritten the committed financing to support AAM’s requirements in connection with the Combination.
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The bridge financing has been successfully syndicated to a broad group of financial institutions in the form of a $843 million Term Loan B, $843 million 1st Lien Senior Secured Bridge Facility and $500 million 2nd Lien Senior Secured Bridge Facility. In addition, AAM has amended its Credit Agreement to, among other things, extend the maturity date of the Revolving Credit Facility (RCF) and the Term Loan A with a new five-year term. The amended Credit Agreement also increases the commitments under the RCF to approximately $1.5 billion (an increase of $570 million as compared to AAM’s current Credit Agreement), automatically effective at the Combination closing date, to reflect the increased size of the company resulting from the Combination.
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“We are pleased with the strong support of our banking partners in the financing of this important and transformational business combination for AAM,” said Christopher J. May, AAM’s Executive Vice President and Chief Financial Officer. “The Amended Credit Agreement extends AAM’s maturity profile and enhances our liquidity while further strengthening our capital structure.”
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Investor Presentation
AAM posted an investor presentation that provides additional information on the attractive business outlook for AAM, as well as the significant benefits and value creation potential of the Combination. The presentation highlights:
- AAM’s high revenue visibility in core driveline programs with over $20 billion in lifetime revenues secured through 2030 and beyond.
- AAM’s favorable positioning for resurging ICE / Hybrid volumes and quote activity in North America.
- The expanded geographic diversification which enables the company resulting from the Combination to better serve customers while still maintaining the highest North American exposure among US-listed auto parts companies.
- The robust process for identifying the $300 million of run-rate cost synergies and the ability to generate free cash flow.
- The status of the regulatory approval process.
Source: Businesswire
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