Flex Ltd. has entered into a Series A Convertible Preferred Stock Investment Agreement with a group of investors led by General Catalyst and including Koch Equity Development. The agreement, dated October 2, 2026, involves the sale of 200,000 shares of Series A Convertible Preferred Stock in Axiom Solutions International, Inc., a wholly owned subsidiary of Flex. The preferred stock has a par value of $0.0001 per share and an aggregate purchase price of $2,000,000,000, or $10,000 per share.
The investment is intended to support Axiom, Flex’s Cloud and Power Infrastructure segment, as it prepares to separate from the parent company. Flex intends to spin off Axiom into an independent, publicly traded company in the first quarter of 2027. The net proceeds from the investment will be used to fund a portion of the purchase price of Axiom’s pending acquisition of EPC Power Corp., repay bridge financing, pay dividends on the preferred stock, or for general corporate purposes.
Under the terms of the agreement, the Convertible Preferred Stock pays a dividend of 10.0% per annum in cash prior to the separation. Following the separation, the dividend rate steps down to 6.0% per annum in cash or 7.0% per annum if paid in kind. General Catalyst will have the right to nominate one director to Axiom’s board of directors following the separation.
Flex has agreed to guarantee Axiom’s obligation to redeem all outstanding shares of the Convertible Preferred Stock if the Spin-Off is not completed on or before December 31, 2027. The redemption price is set at 115% of the purchase price if paid in cash, or 125% if paid in Flex’s ordinary shares. Any unpaid portion of the redemption price will bear interest at a rate of 12% per annum.
The closing of the Preferred Investment is subject to customary closing conditions, including the expiration of the Hart-Scott-Rodino Antitrust waiting period and the receipt of required regulatory approvals.
