Flex (NASDAQ: FLEX) announced on October 5, 2026, that it has entered into an agreement to sell USD 2 billion of shares of Series A Convertible Preferred Stock of Axiom Solutions International, Inc. (Axiom), Flex's Cloud and Power Infrastructure segment, to funds affiliated with General Catalyst, Koch Equity Development, and co-investors.

The investment values Axiom at an initial enterprise value of USD 37.5 billion.

Strategic Investment for Axiom's Independent Growth and Future Separation

The transaction aims to foster sustainable growth for Axiom as it transitions to an independent entity. Following the separation, the investment will focus exclusively on Axiom. Flex plans to establish Axiom as a standalone, publicly traded company in the first quarter of 2027, pending the fulfillment of standard conditions.

Leadership Commentary

"This investment provides equity funding for our recently announced acquisition of EPC Power and will allow Axiom to have a strong balance sheet as we prepare to stand up as an independent, publicly traded company squarely focused on the power, thermal, and compute infrastructure the AI era demands," said Revathi Advaithi, Chief Executive Officer of Flex and expected Chief Executive Officer of Axiom.

Advaithi added that General Catalyst brings deep conviction in applied AI and a long track record partnering with companies building category-defining leaders and said the transaction reflects the value Flex sees in Axiom's business today and will translate into lasting value for Flex shareholders as the separation comes together.

Hemant Taneja, Chief Executive Officer of General Catalyst, said, "Axiom sits at the center of the power and infrastructure buildout that AI demands, and we've been impressed by the team's execution and the scale of the opportunity ahead."

Taneja said General Catalyst looks forward to partnering with Axiom for the long term as it becomes an independent company and continues to invest in the technology and capacity this next phase of growth requires.

Madhu Namburi, Managing Director at General Catalyst, said, "AI diffusion requires modern power solutions at scale." Namburi said that under Revathi's leadership, General Catalyst believes Axiom will become the defining power company of the AI era.

Terms of the Investment

The Convertible Preferred Stock pays a dividend of 10.0% per annum in cash prior to the separation. Following the separation, the dividend steps down to 6.0% per annum in cash, or 7.0% per annum if paid in kind, subject to increases after the fifth anniversary of the separation and certain other adjustments.

As part of the investment, General Catalyst will have the right to nominate one director to Axiom's board of directors following completion of the separation.

The investment is expected to close following receipt of customary regulatory approvals and satisfaction of other customary closing conditions.

Use of Proceeds and Acquisition Financing

Net proceeds from the investment will be used to fund a portion of the purchase price of Axiom's pending acquisition of EPC Power, to repay any equity bridge or other intermediate financing incurred in connection with the acquisition, to pay dividends on the Convertible Preferred Stock, or for general corporate purposes.

Flex separately has secured committed term loan financing for the balance of the EPC Power acquisition.

Strategic Context

Through the strategic investment, Axiom will be positioned to further capitalize on the growing AI infrastructure demand as it prepares to operate as an independent company. Flex previously announced its intention to separate its Cloud and Power Infrastructure segment into an independent, publicly traded company, Axiom, which is expected to be completed in the first quarter of calendar year 2027.

According to Flex, the company in the AI era is helping customers accelerate data center deployment by solving power, heat, and scale challenges through cutting-edge power and cooling technology and scalable IT infrastructure solutions.

Advisors

PJT Partners is serving as financial advisor to Flex, and Skadden, Arps, Slate, Meagher & Flom LLP is serving as Flex's legal counsel. Davis Polk & Wardwell LLP is serving as legal counsel to General Catalyst.

About the Companies

Flex is a manufacturing partner that helps brands design, build, and manage products. With a global footprint spanning 30 countries, Flex delivers advanced manufacturing and supply chain solutions, innovative products and technology, and lifecycle services that support customers from concept to scale.

General Catalyst is a global investment and transformation company with a venture at its core, supporting founders from the seed to growth stage and beyond, with a focus on resilience and applied AI.

The firm has offices in San Francisco, New York City, Boston, Berlin, Bangalore, London, and Washington, D.C., and has supported the growth of more than 900 businesses, including Airbnb, Anduril, Anthropic, Applied Intuition, Commure, Glean, Guild, Gusto, Helsing, Hubspot, Kayak, Livongo, Mistral, Ramp, Samsara, Snap, Stripe, Sword, and Zepto.

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