as·si·du·i·ty

In Oct-97 The Blackstone Group (‘Blackstone’) acquired 63.9% of the common stock of U.S. auto parts manufacturer American Axle & Manufacturing Holdings, Inc. (‘AXL’) in a US$474m recapitalization that valued the equity at US$112m (US$2.85 per share). Including US$490m in net debt at 31-Dec-98 the enterprise value amounted to US$602m.
This implied the following multiples: 28% of sales for 1997 (US$2.15bn, 4.0x net tangible capital turn), 3.9x EBITDA for 1997 (US$153m, 7.7% margin), 5.2x EBITA for 1997 (US$116m, 5.4% margin).
In Feb-99 AXL was floated on the NYSE at US$17 per share valuing the equity at US$671m and US$1.24bn including US$570m in net debt (61% of sales for 1998, 10.4x EBITDA for 1998).
In subsequent secondary offerings (Aug-01, Mar-02, Oct-03 and Dec-03) Blackstone sold all of its AXL shares at an average price of US$28.50 realizing a multiple of exactly 10x its original cost. In the latest two offerings (Oct-03 and Dec-03) Blackstone sold half its original stake in AXL common stock for a total of US$461m valuing the equity at US$1.8bn and implying an enterprise value of US$2.23bn including US$437m in net debt at 31-Dec-03.
This implied the following multiples: 61% of sales for 2003 (US$3.68bn, 2.3x net tangible capital turn), 4.3x LTM EBITDA 2003 (US$514m, 23.0% margin), 6.1x EBITA for 2003 (US$346m, 9.4% margin).