General Catalyst and Koch Back Flex’s Axiom With $2 Billion Investment at $37.5 Billion Valuation in US

A USD 2.0 Billion Vote of Confidence Ahead of Separation

Flex, trading on NASDAQ under the ticker FLEX, has signed an agreement on October 5, 2026, to sell USD 2 billion of Series A Convertible Preferred Stock in Axiom Solutions International, Inc., its Cloud and Power Infrastructure segment, to funds affiliated with General Catalyst, Koch Equity Development, and co-investors.

The deal places an initial enterprise value of USD 37.5 billion on Axiom. The capital comes as Axiom readies itself to operate independently.

Pro forma for the separation, the investment will sit entirely within Axiom. Flex plans to spin the segment out as an independent, publicly traded company in the first quarter of calendar 2027, pending satisfaction of customary conditions.

Dividend Structure and Board Rights

Under the terms of the investment, the Convertible Preferred Stock carries a 10.0% per annum cash dividend before the separation. Once the separation is complete, that rate steps down to 6.0% per annum in cash, or 7.0% per annum if paid in kind, with increases possible after the fifth anniversary of the separation and subject to certain other adjustments.

General Catalyst will also gain the right to nominate one director to Axiom's board of directors once the separation is finished. Closing of the investment is expected after receipt of customary regulatory approvals and satisfaction of other customary closing conditions.

Proceeds Directed Toward EPC Power Acquisition

Net proceeds are earmarked for several purposes: funding a portion of the purchase price for Axiom's pending acquisition of EPC Power, repaying any equity bridge or other intermediate financing incurred in connection with that deal, paying dividends on the Convertible Preferred Stock, and general corporate purposes. Flex has separately secured committed term loan financing to cover the balance of the EPC Power acquisition.

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

She added that General Catalyst brings deep conviction in applied AI and a long track record of partnering with companies building category-defining leaders, and that 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.

Investors See Axiom at the Center of AI Power Buildout

Hemant Taneja, Chief Executive Officer of General Catalyst, said Axiom sits at the center of the power and infrastructure buildout that AI demands, and that the firm has 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 added that under Revathi's leadership, General Catalyst believes Axiom will become the defining power company of the AI era.

Positioning for AI Infrastructure Demand

The strategic investment is intended to position Axiom to further capitalize on growing AI infrastructure demand as it prepares to operate independently. Flex had previously announced its intention to separate its Cloud and Power Infrastructure segment into an independent, publicly traded company named Axiom, with completion expected in the first quarter of calendar year 2027.

Flex describes its role in the AI era as 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 to the Transaction

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

Background on the Parties

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

General Catalyst is a global investment and transformation company with a venture at its core, backing founders from the seed stage through growth stage and beyond, with an emphasis on resilience and applied AI.

The firm maintains offices in San Francisco, New York City, Boston, Berlin, Bangalore, London, and Washington, D.C., and has supported 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.