CAE to buy L3Harris military training business for US$1.05 billion
CAE corporate headquarters in Montreal. (Canadian Press file photo)
MONTREAL -- CAE Inc. announced a deal Monday with U.S. company L3Harris Technologies to buy the company's military training business for US$1.05 billion.
The L3Harris military training business includes Link Simulation & Training, Doss Aviation and AMI.
"We are adding new customers, experience on new platforms and building our depth of expertise to address all domains -- air, land, sea, space and cyber -- as well as expanding into adjacent markets such as mission and operations support," CAE chief executive Marc Parent said in a statement.
"This proposed transaction will provide greater balance to CAE across businesses and geographies, and like our recent acquisitions in the civil aviation market, it demonstrates our focus on bolstering and expanding our position in the markets we serve."
CAE said the L3Harris businesses will add experience in the development and delivery of training systems for fighter and bomber aircraft, army rotary-wing platforms, submarines and remotely piloted aircraft.
CAE has announced several acquisitions in recent months.
In December, CAE signed an agreement to buy Merlot Aero Ltd., a leading civil aviation crew management and optimization software company, while in November it announced a deal for Amsterdam-based Flight Simulation Company BV.
CAE also signed a deal in November with Textron to buy TRU Simulation + Training Canada Inc.
To help pay for the L3Harris deal, CAE will raise C$700 million in an agreement with Caisse de depot et placement du Quebec and GIC Private Ltd., a sovereign wealth fund based in Singapore.
CDPQ has agreed to invest $475 million in CAE in a move that it says will make it the company's largest shareholder, while GIC will contribute $225 million.
The closing of the acquisition is expected in the second half of this year, subject to regulatory approvals and other customary closing conditions.
- This report by The Canadian Press was first published March 1, 2021.