Caisse de dépôt et placement du Québec (CDPQ) will become CAE’s largest shareholder, paying $ 475 million in capital, which will be used to acquire the United States.
The Montreal-based company wants to swallow L3 Harris Technologies’ military training division for $ 1.05 billion, which includes connectivity simulation and training, DOS aviation and AMI.
“L3 Harris Connect is one of the largest providers of military training solutions in the United States; DOS Aviation is a US Air Force (USAF) early flight training provider; and AMI is a simulator hardware design and manufacturing facility,” CAE said in a statement Monday.
GIC Pvt. Ltd. is a party to this transaction with a $ 225 million investment in CAE.
“Supporting and promoting the growth of Quebec companies represents key pillars of our investment strategy in Quebec,” said Kim Tomasin, Quebec’s senior vice president and head of investment and sustainable investment in renewal.
For its part, CAE said it would raise earnings per share by at least 10% in the first year of the transaction. In addition, the company estimates that L3 Harris Technologies could generate between $ 35 million and $ 45 million per year by integrating military training operations.
“The proposed acquisition represents an opportunity to create a significant value for all CAE shareholders.
“We are adding new customers and experience to new platforms, and while growing, we are expanding our expertise to meet demand from all areas, from aerospace, land, naval, aerospace and cybernetics,” he added.