American Axle & Manufacturing Holdings, Inc. (NYSE: AXL) announced plans Wednesday to sell its U.S. iron casting operations known as Grede to funds managed by Gamut Capital Management for $245 million.
The $245-million sale price will consist of $185 million in cash and a $60-million deferred payment obligation, subject to certain customary adjustments.
For the full year 2018, Grede generated $781 million in sales, American Axle said.
The auto supplier said it will retain its El Carmen, Mexico iron casting operations.
"The sale of Grede will enable us to streamline our business, accelerate our debt reduction initiatives and enhance our margin profile," CEO David Dauch said in a statement.
"We will continue to optimize and invest in our highly-engineered product portfolio, focus on profitable growth opportunities including electrification, and further strengthen AAM's value proposition to all key stakeholders."
American Axle stock was down 4.05% at $7.94 at the time of publication.
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