American Axle & Manufacturing will acquire parallel automotive drivetrain manufacturer Dowlais Group plc in a deal projected to be worth $1.44 billion in cash and AAM stock. “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,” stated AAM chairman and CEO David Dauch.
Together the two businesses represent a range of design and manufacturing capabilities that span internal combustion engine, hybrid, and electric vehicles, with presence in major automakers supply chains. As summarized by AAM, their combined portfolio of products and an optimized cost structure, will position the new organization to serve automakers in multiple regions and “support changing propulsion trends as the industry continues to evolve.”
American Axle anticipates the combined group will achieve $300 million in cost savings within three years of completing the deal.
The takeover will close by the end of 2025, subject to approval by shareholders, and regulatory approvals in the U.S., European Union, and China (where Dowlais has a joint-venture business.)
Financing is in place to support the transaction, according to American Axle.
The combined firm will be headquartered in Detroit, with the current AAM leadership remaining in charge. Two Dowlais directors will be added to the American Axle board.
Dowlais – which is comprised of the former GKN Automotive assets – was created via an asset spinoff by investor group Melrose Industries Plc, in 2023.
American Axle was founded in 1994 by investors who acquired the General Motors driveline and forging operations.
Both companies are structured to manufacture driveline systems in North America, Europe, Asia, and Latin America.
“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,” Dauch added.
