Initial guidance surfaces on American Axle’s $1.2 billion two-part senior notes offering

By Paul A. Harris

Portland, Ore., March 8 – American Axle & Manufacturing Inc., a wholly owned subsidiary of American Axle & Manufacturing Holdings Inc., has circulated initial yield guidance in its $1.2 billion two-part offering of senior notes (B2/B/BB-), according to a trader.

Notes in the short-maturity tranche, eight-year notes which come with three years of call protection, are guided at 6% to 6¼%.

Notes in the long maturity tranche, 10-year notes which come with five years of call protection, are guided at 6¼% to 6½%.

Tranche sizes remain to be determined.

The deal is expected to price on Thursday.

J.P. Morgan Securities LLC, Barclays, Citigroup Global Markets Inc., RBC Capital Markets LLC, PNC Capital Markets and U.S. Bancorp Investments Inc. are the joint bookrunners.

Proceeds will be used to fund the acquisition of Metaldyne Performance Group Inc., as well as to refinance debt under American Axle's existing senior secured revolving credit facility and certain existing Metaldyne debt, with the remainder, if any, to be used for general corporate purposes.

American Axle is a Detroit-based manufacturer and designer of driveline and drivetrain systems and related components and modules, chassis systems, electric drive systems and metal-formed products.

Metaldyne is a Plymouth, Mich.-based provider of highly engineered lightweight components for use in powertrain and suspension applications for the vehicle markets.

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