Aam Announces Combination With Dowlais For 1.44 Billion In Cash And Stock

American Axle Manufacturing AAM, NYSE: AXL is pleased to announce that it has reached an agreement with the board of the Dowlais Group plc Dowlais, LON: DWL on the terms of a recommended cash and share offer to be made by AAM for the entire issued and to be issued ordinary share capital of Dowlais the Combination for approximately 1.44 billion in cash and AAM shares.

With a combined portfolio of products essential in the manufacturing of internal combustion engine ICE, hybrid and electric vehicles EV, coupled with an enhanced cost structure, the combined company will be well-positioned to serve a diverse customer base spanning multiple geographies and support changing propulsion trends as the industry continues to evolve.

Under the terms of the agreement, Dowlais shareholders will be entitled to receive for each share of Dowlais common stock: 0.0863 shares of new AAM common stock, 42 pence per share in cash and up to a 2.8 pence of Dowlais FY24 final dividend prior to closing. Upon closing of the transaction, it is expected that AAM shareholders will own approximately 51 of the combined group and Dowlais shareholders will own approximately 49.

Based on AAMs closing share price and the Sterling to Dollar exchange rate on January 28, 2025 , the terms of the Combination including the FY24 final dividend represent a total implied value of 85.2 pence per Dowlais share and value the entire issued and to be issued ordinary share capital of Dowlais at approximately 1.16 billion on a fully diluted basis. This represents a 25 percent current premium to Dowlais January 28, 2025 closing share price and a 45 percent premium to the volume-weighted average share price of Dowlais for the three-month period ended January 28, 2025 .

This announcement marks another key milestone in our continued long-term strategic growth plan, said David C. Dauch , AAMs Chairman and Chief Executive Officer. We are excited to bring together these two outstanding companies to create a leading driveline and metal-forming supplier serving the global automotive industry as it continues to evolve. The combination will create significant immediate and long-term shareholder value while helping to power a more sustainable future. Together with Dowlais, we will have the powertrain-agnostic product portfolio, global reach, commitment to innovation and financial strength to meet the needs of customers and succeed in a dynamic market environment.