Target: AxleTech International
Sponsor: General Dynamics
Seller: The Carlyle Group
Financial Adviser: Seller: Merrill Lynch
Legal Adviser: Seller: Latham & Watkins LLP
Terms of the deal were not released. The Carlyle Group bought the Troy, Mich.-based company in October 2004 for $345 million, financed with $265 million of debt, according to Moody’s Investors Service. The deal came out of
AxleTech makes axles, brakes and other components used in military vehicles, as well as machines used in the forestry, mining and agricultural markets. The company completed three acquisitions under The Carlyle Group, the most recent being last month when it bought United States Gear Corp., a Chicago maker of gears for trucks. AxleTech has facilities in Chicago, Oshkosh, Wis., Detroit, Saint Etienne, France, and Osasco, Brazil.
Chris Ullman, spokesman for The Carlyle Group, said that AxleTech’s employment rose from 500 to 1000 under the buyout firm. He added that The Carlyle Group, which has experience investing in military contractors, was able to increase the company’s military clientele. “It’s grown considerably through organic growth and through acquisitions, and it had gotten to a point where we feel it’s been an excellent investment,” he said.
The deal, expected to close by the end of the year, would mark the twelfth exit of 2008 for The Carlyle Group across various funds. The most recent completed exit was the firm’s sale of Crest Communications Corp. for $70 million on Nov. 11. That company, a Hillsboro, Ore.-based fiber optic and undersea cable operator, was sold to Alaska Communications Systems Group.
The original investment in Crest Communications was made from The Carlyle Group’s
Officials at General Dynamics and AxleTech did not return calls or declined to comment.