Canadian military training provider CAE has received the required regulatory approvals for the acquisition of L3Harris Technologies' Military Training business for US$1.05bn.
In a statement released on June 28 CAE revealed that it expected closing to complete on July 2 in a move that marks a significant expansion of the company’s position in the military training and simulation market and will approximately double its core business in the United States.
The L3Harris Military Training business, which includes Link Simulation and Training, Doss Aviation and AMI, will be integrated with CAE USA, and according to the CAE release, serve to broaden the company’s ability to provide training and support solutions across multi-domain operations.
Through the acquisition CAE will be able to provide additional experience in the development and delivery of training systems for fighter and bomber aircraft, US Army rotary-wing platforms, submarines and remotely piloted aircraft.
Marc Parent, CAE's CEO, said: "This represents the largest acquisition in our history and clearly demonstrates our strategy to strengthen and expand our position in all the markets CAE serves. We will be emerging from the pandemic much stronger and more ready to meet the growing demands of our customers."
CAE USA will become the prime contractor or key subcontractor on a range of programmes, including the United States Air Force (USAF) Simulators Common Architecture Requirements and Standards (SCARS) programme, USAF F-16 Simulators Training Programme (STP), US Navy/Marine Corps F/A-18 aircrew training systems, USAF initial flight training, USAF Ground Based Strategic Deterrent training and USAF B-2 training system.
The acquisition, which was first announced on March 1, 2021, is expected to provide low teens percentage earnings per share accretion for the company within its first full year post-close and to be immediately accretive to operating income.