Flex Signs $2 Billion Axiom Investment Deal

Flex announced in a press release an agreement for a $2 billion convertible preferred equity investment in Axiom, its cloud and power infrastructure business. Funds affiliated with General Catalyst, Koch Equity Development and other investors will provide the capital at an initial enterprise value of $37.5 billion.

The preferred stock will pay a 10% annual cash dividend before Axiom separates from Flex. After the separation, the rate will fall to 6% in cash or 7% if paid in kind. General Catalyst will also have the right to nominate one director to Axiom's board after the separation.

Axiom will use the proceeds to help fund its pending acquisition of EPC Power, repay related interim financing, pay preferred stock dividends or cover general corporate needs. Flex plans to separate Axiom into an independent public company in the first quarter of 2027. The investment requires regulatory approval and other customary closing conditions.