Flex (FLEX) has put a price on Axiom, its data centre power business. On 5 October 2026 it agreed to sell a stake in Axiom to investors led by General Catalyst. The deal values Axiom at up to $37.5 billion. Flex plans to list Axiom as a separate company in early 2027.
The shares closed almost flat on 5 October. They rose 4.0% on 6 October.
What did Flex announce? Flex agreed to sell $2.0 billion of convertible preferred shares in Axiom, its data centre power business. The deal puts Axiom's enterprise value, its shares plus debt minus cash, at up to $37.5 billion.
On that price, the Axiom that Flex owns today is worth $33.1 billion, or 70.1% of Flex's enterprise value.
If Axiom is worth that much, the rest of Flex is priced at about a quarter of Axiom's profit multiple.
Flex shareholders vote on the spin-off on 2 November 2026.
What Flex announced
Flex reported the deal in a Form 8-K, a major-event filing, with a press release. Formally, Axiom is Flex's Cloud and Power Infrastructure segment.
Funds linked to General Catalyst, Koch Equity Development and co-investors will buy 200,000 Axiom convertible preferred shares at $10,000 each, or $2.0 billion in total. A convertible preferred share pays a set dividend. It can later be swapped for ordinary shares.
After the spin-off, the investors can swap into Axiom shares at the lower of two prices. One implies a $37.5 billion enterprise value. The other is 120% of Axiom's average price over its first 30 trading days.
A lower price gives the investors more shares. A floor stops the swap value falling below $30.0 billion.
The preferred pays a 10.0% cash dividend a year before the spin-off. After it, the rate drops to 6.0% in cash, or 7.0% paid in extra shares.
If the spin-off has not happened by 31 December 2027, Axiom must buy the shares back. It pays 115% of the $10,000 issue price in cash, or 125% in Flex shares. Axiom picks which, with Flex's approval. Flex guarantees the payment.
The money helps pay for EPC Power, a maker of power conversion equipment for data centres and power grids. Flex agreed to buy it for $4.4 billion on 3 September 2026. A $3.3 billion term loan also backs the purchase. The $2.0 billion investment still needs US antitrust clearance.
How FLEX stock reacted
The shares rose 3.96% on 6 October, to $121.38.
Source: YX Insights
A moving average is the mean closing price over a set number of days. The close of $121.38 sits 6.3% above the 50-day average of $114.17. It sits 21.2% above the 200-day average of $100.16.
The Relative Strength Index (RSI) runs from 0 to 100. It compares gains with losses over the last 14 days. Above 70 marks a stretched reading. Below 30 marks an oversold one. It stands at 60.9.
The grey bars on the right show how many shares traded at each price, called the volume profile. The busiest band was $61 to $66.
Source: YX Insights
Each candle is one day. The thick body runs from the open to the close, while the thin line spans the high and low. Green means it closed above its open, red below.
On 5 October the shares opened at $116.99, ranged from $116.50 to $121.48 and closed at $116.76. That candle is red because the close was below the open, even though it was 0.13% above the previous close of $116.61.
What it means for the valuation
Flex's market value at the 6 October close was $44.8 billion. Add $5.2 billion of debt and take off $2.8 billion of cash at 26 June 2026. That gives an enterprise value of $47.2 billion. Axiom's $37.5 billion ceiling equals 79.4% of it.
Source: Flex SEC filings; YX Insights
The bars are not like for like. The $37.5 billion is measured after the spin-off, so it includes EPC Power. Flex does not own EPC Power yet.
Without EPC Power's $4.4 billion price, the Axiom Flex owns today is worth $33.1 billion on the deal's terms. That is 70.1% of Flex's enterprise value. If Axiom is worth exactly that, $14.1 billion is left for the rest of Flex.
Flex reports a profit measure called segment income. It leaves out stock-based pay and corporate costs. It is not profit under US accounting rules (GAAP).
In the quarter to 26 June 2026, the rest of Flex made $334 million of segment income. Multiplied by four for a rough yearly figure, that is $1,336 million. The $14.1 billion is 10.6 times that.
Axiom made $214 million of segment income, or $856 million a year on the same rough basis. The $33.1 billion is 38.7 times that.
Axiom's sales grew 35.4% on a year earlier, against 15.7% for the rest of Flex. If Axiom is worth $33.1 billion, the rest of Flex is priced at about a quarter of Axiom's multiple.
The $37.5 billion is a negotiated ceiling, with a dividend, a buy-back promise and a floor attached. Flex also plans to keep 6.0% to 12.0% of Axiom after the spin-off. That stake sits on Axiom's side of the sum, not in the $14.1 billion.
What to watch next
Flex shareholders vote on the spin-off at an extraordinary general meeting on 2 November 2026. Flex holds its Investor Day on 10 November 2026. The EPC Power purchase is due to close in the fourth quarter of 2026.
The spin-off also needs final board approval and the consent of the High Court of Singapore, where Flex is incorporated. Axiom's Form 10, the filing that registers its shares with the US Securities and Exchange Commission, must take effect.
On the deal's terms, the Axiom that Flex owns today is worth $33.1 billion, while the rest of Flex is priced at about a quarter of Axiom's multiple. Axiom's own share price will test that if the spin-off goes ahead.
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Common questions about Flex stock
Yes, if the spin-off is approved. Flex plans to distribute between 88.0% and 94.0% of Axiom's shares to its own shareholders, in proportion to their holdings. The exact number of Axiom shares for each Flex share will be set before the distribution. Shareholders vote on the plan on 2 November 2026.
How much is Axiom worth?
The preferred deal sets an enterprise value of up to $37.5 billion for Axiom, with a floor of $30.0 billion. These are terms for converting the preferred shares, not a market price. Axiom's own share price will set its market value once it starts trading after the spin-off.
When is the Flex spin-off?
Flex expects to spin off Axiom in the first quarter of 2027. It first needs a shareholder vote on 2 November 2026 and final board approval. It also needs an effective Form 10 registration for Axiom's shares and approval from the High Court of Singapore. The preferred shares must be bought back if the spin-off misses 31 December 2027.
DISCLAIMER: This article is strictly educational. Any information or analysis in this note is not an offer to sell or the solicitation of an offer to buy any securities. Nothing in this note is intended to be investment advice and nor should it be relied upon to make investment decisions. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note's date of publication and are subject to change without notice.