American Axle Sets Sights on Growth with 2025 Outlook and Dowlais Acquisition

Published 21 hours agoAXL

American Axle Sets Sights on Growth with 2025 Outlook and Dowlais Acquisition

American Axle & Manufacturing Holdings, Inc. has unveiled its financial projections for 2025, setting expectations for sales between $5.8 billion and $6.05 billion. The company anticipates its adjusted EBITDA will fall within the range of $700 million to $760 million, with a forecasted adjusted free cash flow of $200 million to $230 million. These figures are based on a projected 15.1 million units of North American light vehicle production, capital spending comprising 5% of sales, and restructuring cash payments estimated between $20 million and $30 million. Notably, the outlook excludes costs from the recently announced merger with Dowlais.

In a strategic move to expand its operations, AAM is acquiring Dowlais Group plc, a transaction valued at around $1.44 billion in cash and stock. This merger aims to bolster AAM's capabilities in the electric vehicle sector and is expected to yield $300 million in annual cost synergies. Once completed, the combined entity is projected to generate approximately $12 billion in annual revenue, with ownership split between AAM and Dowlais shareholders at about 51% and 49%, respectively. AAM's current CEO, David C. Dauch, is slated to lead the newly formed company, with the deal anticipated to conclude by the end of 2025.

American Axle's stock is currently priced at $3.99, experiencing its highest intraday trade at $4.24 and its lowest at $3.85, with a trading volume of nearly 3.9 million shares as of May 2. Reuters reported this market data, indicating steady investor interest in the company's stock as AAM navigates these significant business developments.

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