AAM Unveils Plans for New Senior Secured and Unsecured Notes Offering

On September 15, 2025, American Axle & Manufacturing Holdings, Inc. (NYSE: AXL) announced its intention to offer a total of $843 million in senior secured notes and $600 million in senior unsecured notes via its wholly-owned subsidiary, American Axle Manufacturing, Inc. This move aims to solidify the company’s financial footing during its pending business combination with Dowlais Group plc, alongside addressing other financial commitments.

Overview of the Offering

The proposed offering will consist of two types of notes. The first is the senior secured notes, which are expected to yield approximately $843 million and have a maturity date set for 2032. These notes will be secured by the majority of the assets of the issuer and its subsidiaries, ensuring a first priority security interest. The second offering includes $600 million in senior unsecured notes due in 2033. Both offerings are subject to market conditions and the successful execution of the anticipated business combination.

American Axle’s approach is characterized by a commitment to secure favorable financing terms through these notes, which will ultimately boost their strategic financial operations, particularly in connection with their merger with Dowlais Group plc. The notes will be unconditionally guaranteed, ensuring a layer of security for investors.

Proceeds Utilization

The proceeds from this offering will be strategically allocated in various ways:
1. Business Combination Expenses: A portion will be directed towards cash payments related to the ongoing business combination with Dowlais, alongside covering applicable fees and expenses.
2. Debt Repayment: Another significant part of the proceeds will be used to settle all outstanding borrowings under Dowlais’s existing credit facilities, effectively terminating these facilities.
3. Note Redemption: Funds will be set aside for a change of control offer for certain outstanding notes from Dowlais.
4. General Corporate Purposes: The remaining balance will be allocated for corporate expenses, including the repayment of further debts.

To mitigate risk, if the business combination does not close in conjunction with the offering, funds will be placed in segregated escrow accounts for both the secured and unsecured notes, ensuring that the offering proceeds are appropriately allocated until conditions are met or a special mandatory redemption occurs.

Forward-Looking Statements

American Axle emphasizes that the planned offering involves various forward-looking statements, indicative of their goals and expectations regarding future financial performance. These statements encompass a plethora of aspects, such as anticipated trends in automotive demand, global economic conditions, and the company’s response to these dynamics. However, it is crucial to state that such projections are inherently uncertain and subject to various risks that may lead to deviations from their anticipated outcomes.

As an illustrative example, several factors could potentially influence the success of this offering and the subsequent performance of American Axle, including economic shifts, competition, global supply chain challenges, and the evolving automotive industry landscape. The company has expressed commitment to navigating these challenges while staying focused on generating added value for stakeholders through effective financial management practices.

Regulatory Compliance

Important to note, the notes being offered will not be registered under the Securities Act of 1933 and will be available exclusively for qualified institutional buyers. This exclusivity aligns with the securities regulations, which American Axle is adhering to throughout the offering process. Compliance with applicable laws and regulations is paramount to ensuring both the legality and ethicality of their financial maneuvers.

In conclusion, American Axle & Manufacturing’s proposed offering of senior secured and unsecured notes marks a pivotal moment in their strategic financial planning, ensuring they are well-equipped to address both immediate and long-term obligations as they prepare for significant transitions within the corporate landscape.