CHICAGO, August 25, 2026, 16:00 EDT — Madison Air shares rose 12.1% after the company secured $2.25 billion through a placement to finance its purchase of ebm-papst.
- Shares of Madison Air ended the session at $27.99, rising $3.02, or 12.09%.
- The company plans to offer 90.1 million shares, pricing them at $24.97 apiece.
- The $2.25 billion placement covers the entire equity component of the acquisition.
- The remaining payment will be covered by approximately $2.8 billion in debt and cash.
Shares in Madison Air Solutions Corporation NYSE:MAIR rose 12.09% on Tuesday following the company’s resolution of a key financing hurdle in its intended purchase of ebm-papst. The stock ended the session at $27.99.
The air-quality technology manufacturer will issue 90,108,130 Class A shares at $24.97 each. The transaction is anticipated to generate gross proceeds of approximately $2.25 billion, which will cover the deal’s equity component in full. The closing is projected to occur near September 1.
Investors prioritized funding certainty over the risk of immediate dilution. By Tuesday’s close, shares were up 12.1% from the placement price, erasing losses posted after the August 17 acquisition announcement.
| Financing measure | Amount | Investor reading |
|---|---|---|
| New Class A shares | 90.1 million | Roughly 18% of projected pre-transaction shares outstanding |
| Placement price | $24.97 | Priced at a 12.1% discount to Tuesday’s closing price |
| Gross equity proceeds | $2.25 billion | Covers the full equity financing portion |
| Remaining funding | About $2.8 billion | Will come from debt and existing cash reserves |
The calculation for the share count is based on the approximately 490 million shares suggested by Madison Air’s valuation at its April IPO. Issuing 90.1 million additional shares would boost this number by an estimated 18.4%. The newly issued shares would account for nearly 15.5% of the increased total. The figure remains an estimate as Madison Air has several categories of shares.
Chairman Larry Gies pledged $300 million for the placement, while an affiliated entity added a further $320 million. Together, the purchases represent 27.6% of gross proceeds and are subject to one-year lockups.
Last week, Madison Air announced a $5.4 billion deal to acquire Germany’s ebm-papst. Factoring in anticipated tax advantages, the net enterprise value of the transaction stands at $5.0 billion. Ebm-papst produces fans, motors, and airflow systems for data centers and industrial machinery.
The purchase price is roughly 4.8 times the midpoint of Madison Air’s projected 2026 adjusted EBITDA. Management had earlier calculated 14.6 times for ebm-papst’s 2026 adjusted EBITDA after accounting for tax advantages, or 10 times when including anticipated run-rate synergies.
| Madison Air measure | Latest value | Change or context |
|---|---|---|
| Q2 net sales | $991.3 million | Increase of 21% from a year earlier |
| Q2 adjusted EBITDA | $265.8 million | Rose 18% |
| Q2 adjusted EBITDA margin | 26.8% | Decreased by 0.7 percentage point |
| Backlog | $2.87 billion | Jumped 133% |
| Net leverage | 2.8 times | Prior to acquisition financing |
Madison Air reported second-quarter sales of $991.3 million, a rise of 21%. Adjusted EBITDA grew 18% to $265.8 million. The backlog surged 133% to $2.87 billion. Net leverage at the end of June stood at 2.8 times.
The company anticipates pro forma net leverage to be around 3.7 times upon closing the acquisition. Management aims to reduce this figure to below 2.5 times within two years. Achieving this relies on cash conversion and a minimum of $160 million in expected yearly cost synergies.
| Analyst | Rating | Target |
|---|---|---|
| Stifel | Buy | $41 |
| Barclays | Overweight | $45 |
| RBC | Outperform | $48 |
| Baird | Outperform | $48 |
Analysts have tended to prefer Madison Air’s involvement in data-center cooling. The focus now shifts from whether funding is secured in the short term to evaluating integration outcomes and the rate at which debt levels can be reduced.
Risks: The deal may face holdups due to regulatory approvals. Synergies might take time to materialize, and added debt could lift interest costs. Resale registration of placement shares could boost the public float, potentially weighing on the stock once lockups end.
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