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# Flex Lines Up $2 Billion Axiom Preferred Deal, With A Redemption Guarantee If Spin-Off Slips Past 2027
- URL: https://www.bullished.co/flex-lines-up-2-billion-axiom-preferred-deal-with-a-redemption-guarantee-if-spin-off-slips-9ee8e85a/
- Published: 2026-10-05T12:21:00.000Z
- Updated: 2026-10-05T12:21:00.000Z
- Description: General Catalyst and Koch Equity Development would buy the preferred stock, and Flex backs a payout at 115% in cash or 125% in shares.
- Author: Matteo Parrino
- Tags: SEC Filings, FLEX, Industry: Technology

[Flex](https://www.bullished.co/tag/flex/) agreed to sell [$2.0 billion of Series A Convertible Preferred Stock](https://www.sec.gov/Archives/edgar/data/0000866374/000119312526413173/d123485d8k.htm?ref=bullished.co) in Axiom, its Cloud and Power Infrastructure unit, to General Catalyst, Koch Equity Development and co-investors, an 8-K shows. The deal values Axiom at $37.5 billion on an initial enterprise-value basis, and Flex guarantees a redemption payment if the planned spin-off is not completed by December 31, 2027.

## What the 8-K says

The investors will buy 200,000 preferred shares at $10,000 each in a private placement, for an aggregate $2,000,000,000\. The agreement is dated October 2, and Flex issued a press release on Monday. General Catalyst also gets the right to nominate one Axiom director after the separation.

The preferred pays a 10.0% annual cash dividend before the spin-off. Afterward it pays 6.0% in cash or 7.0% if paid in kind, meaning in additional securities, with increases after the fifth anniversary of the separation.

If the spin-off misses the deadline, Axiom must redeem the shares at 115% of the purchase price in cash or 125% in Flex ordinary shares. Cash dividends already paid are subtracted, and the price is raised if needed so investors keep the same amount after an assumed 25.5% tax rate. Flex guarantees the payment.

Any part of the redemption price left unpaid on the redemption date accrues interest at 12% a year. If Flex shares are used, Axiom and the investors are to try to agree the share count before December 1, 2027, and Flex agreed to provide registration rights.

## What it changes

The money is tied to a deal already in motion. A Flex subsidiary signed an agreement on September 3 to buy EPC Power, which is expected to close in the fourth quarter of 2026 and join Axiom before the spin-off. The investment is connected to that pending acquisition.

For Flex holders, the guarantee is the key term. If the separation slips, Flex stands behind a payout that could be settled in its own ordinary shares. Axiom filed its Form 10 registration with the SEC on September 15, and Flex shares closed at $116.61 on Friday, before the disclosure.

## What to watch

Closing requires expiration of the Hart-Scott-Rodino antitrust waiting period and other regulatory approvals. Flex also intends to file a proxy statement seeking shareholder approval of the spin-off, which it expects to complete in the first quarter of 2027.

The next hard date in the filing is December 31, 2027: miss it, and the redemption clock starts.

### Sources

- [8-K Filing — FLEX LTD. (FLEX)](https://www.sec.gov/Archives/edgar/data/0000866374/000119312526413173/d123485d8k.htm?ref=bullished.co) — SEC EDGAR
- [Exhibit d123485dex991.htm — FLEX LTD. 8-K exhibit](https://www.sec.gov/Archives/edgar/data/0000866374/000119312526413173/d123485dex991.htm?ref=bullished.co) — SEC EDGAR
- [Flex Ltd. (FLEX) stock price, news, quote and history - Yahoo Finance](https://au.finance.yahoo.com/quote/FLEX/?ref=bullished.co) — Yahoo Finance

### More on Flex

- [Flex Signs $3.3 Billion Term Loan To Fund EPC Power Deal, Cutting Bridge Facility By The Same Amount](https://www.bullished.co/flex-signs-3-3-billion-term-loan-to-fund-epc-power-deal-cutting-bridge-facility-by-the-00f1fbba/)

[All Flex (FLEX) coverage →](https://www.bullished.co/tag/flex/)