- Acquisition strengthens CAE's global civil training
capabilities
- Expands addressable market for simulator lifecycle support
- Adds order backlog and access to new customers
- CAE's second acquisition announcement in the last two
weeks
MONTREAL, Nov. 24, 2020 /PRNewswire/ - (NYSE: CAE) (TSX:
CAE) – CAE today announced that it has concluded a conditional
agreement with Textron (NYSE: TXT) to acquire TRU Simulation +
Training Canada Inc. (TRU Canada) for a cash consideration of
approximately US$40 million,
excluding post-closing adjustments. The closing of the transaction
is subject to customary conditions and regulatory approvals.
The acquisition of TRU Canada expands CAE's global installed
base of commercial flight simulators and customers, and the
addressable market for simulator lifecycle support services.
TRU Canada also brings with it a backlog of simulator orders,
full-flight simulator assets and provides access to a number of
airline customers globally.
TRU Canada is CAE's second announced acquisition in the last two
weeks and demonstrates the Company's commitment to deploying the
capital it is raising to strengthen the Company's position across
its markets. The acquisition is aligned with CAE's strategic
priorities and meets the strict financial parameters it has in
place. It is expected to be accretive to earnings in its first full
year.
"We look forward to integrating the TRU Canada business within
CAE. This acquisition demonstrates our ability to bolster our
position and expand our addressable market and our global customer
base during this unprecedented period of disruption. Along with the
recently announced FSC acquisition, we have been able to make
investments that are expected to better enable CAE to meet the
global demands of our customers in support of their training and
simulation needs," said Marc Parent,
CAE's President and Chief Executive Officer.
About CAE
CAE is a high technology company, at the
leading edge of digital immersion, providing solutions to make the
world a safer place. Backed by a record of more than 70 years of
industry firsts, we continue to reimagine the customer experience
and revolutionize training and operational support solutions in
civil aviation, defence and security, and healthcare. We are the
partner of choice to customers worldwide who operate in complex,
high-stakes and largely regulated environments, where successful
outcomes are critical. As a testament to our customers' ongoing
needs for our solutions, over 60 percent of CAE's revenue is
recurring in nature. We have the broadest global presence in our
industry, with approximately 10,000 employees, 160 sites and
training locations in over 35 countries. www.cae.com
Facebook: www.facebook.com/cae.inc
LinkedIn: www.linkedin.com/company/cae
Hashtags: #CAE; #CAEpilot
Caution concerning forward-looking statements
This
press release includes forward-looking statements about the
anticipated benefits of the acquisition by CAE (the Corporation) of
TRU Canada and FSC (the Acquisitions), the Corporation's access to
capital resources, and the Corporation's activities, events and
developments that the Corporation expects to or anticipates may
occur in the future including, for example, statements about the
Corporation's vision, strategies, market trends and outlook, future
revenues, capital spending, expansions and new initiatives,
financial obligations and expected sales. Forward-looking
statements normally contain words like "believe", "expect",
"anticipate", "plan", "intend", "continue", "estimate", "may",
"will", "should", "strategy", "future" and similar expressions. By
their nature, forward looking statements require the Corporation to
make assumptions and are subject to inherent risks and
uncertainties associated with the Corporation's business which may
cause actual results in future periods to differ materially from
results indicated in forward-looking statements. While these
statements are based on management's expectations and assumptions
regarding historical trends, current conditions and expected future
developments, as well as other factors that the Corporation
believes are reasonable and appropriate in the circumstances,
readers are cautioned not to place undue reliance on these
forward-looking statements as there is a risk that they may not be
accurate.
Important risks that could cause such differences include, but
are not limited to, the failure to gain access to expected capital
resources within anticipated timeframes or at all, risks relating
to the Acquisitions, such as all or part of the intended benefits
therefrom not being realized or unanticipated integration-related
issues, costs or delays, risks relating to the COVID-19 pandemic
such as health and safety, reduction and suspension of operations,
global economic conditions, diversions of management attention,
heightened IT risks, liquidity risks and credit risks, risks
relating to the industry such as competition, business development
and awarding of new contracts, level and timing of defence
spending, government-funded defence and security programs,
constraints within the civil aviation industry, regulatory matters,
natural or other disasters, environmental laws and regulations,
climate change, risks relating to CAE such as evolving standards
and technology innovation, the Corporation's ability to penetrate
new markets, R&D activities, fixed-price and long term supply
contracts, strategic partnerships and long-term contracts,
procurement and original equipment manufacturer (OEM) leverage,
product integration and program management, protection of the
Corporation's intellectual property and brand, third-party
intellectual property, loss of key personnel, labour relations,
liability risks that may not be covered by indemnity or insurance,
warranty or other product-related claims, integration of acquired
businesses through mergers, acquisitions, joint ventures, strategic
alliances or divestitures, reputational risk, U.S. foreign
ownership, control or influence mitigation measures, length of
sales cycle, seasonality, continued returns to shareholders,
information technology and cybersecurity, the Corporation's
reliance on technology and third party providers, data privacy, and
risks relating to the market such as foreign exchange, availability
of capital, credit risk, pension plan funding, doing business in
foreign countries, geopolitical uncertainty, anti-corruption laws
and taxation matters. Additionally, differences could arise because
of events announced or completed after the date of this press
release. More information about the risks and uncertainties
affecting CAE's business can be found in the Management's
Discussion & Analysis for the year ended March 31, 2020 and the Management's Discussion
& Analysis for the quarter ended September 30, 2020. Any one or more of the
factors described above and elsewhere in this press release, and in
the documents referenced herein, may be exacerbated by the
continuing COVID-19 pandemic and may have a more negative impact on
CAE's business, results of operations and financial condition.
Accordingly, readers are cautioned that any of the disclosed risks
could have a material adverse effect on CAE's forward-looking
statements. Readers are also cautioned that the risks described
above and elsewhere in this press release, and in the documents
referenced herein, are not necessarily the only ones the
Corporation faces; additional risks and uncertainties that are
presently unknown to the Corporation or that the Corporation may
currently deem immaterial may adversely affect CAE's business.
Except as required by law, the Corporation disclaims any
intention or obligation to update or revise any forward-looking
statements whether as a result of new information, future events or
otherwise. The forward-looking information and statements contained
in this press release are expressly qualified by this cautionary
statement.
Material Assumptions
The forward-looking statements
set out in this press release are based on certain assumptions
including, without limitation: access to expected capital resources
within anticipated timeframes, the integration and the realization
of the anticipated benefits and synergies of the Acquisitions in
the timeframe anticipated, the anticipated negative impacts of the
COVID-19 pandemic on the Corporation's businesses, operating
results, cash flows and/or financial condition, including the
intended effect of mitigation measures implemented as a result of
the COVID-19 pandemic, CAE's available liquidity from cash and cash
equivalents, undrawn amounts on CAE's revolving credit facilities,
the balance available under CAE's receivable purchase program,
CAE's cash flows from operations and continued access to debt
funding will be sufficient to meet financial requirements in the
foreseeable future; and no material financial, operational or
competitive consequences of changes in regulations affecting CAE's
business. For additional information, including with respect to
other assumptions underlying the forward-looking statements made in
this press release, refer to the applicable reportable segment in
the Management's Discussion & Analysis for the year ended
March 31, 2020 and the Management's
Discussion & Analysis for the quarter ended September 30, 2020. Given the impact of the
changing circumstances surrounding the COVID-19 pandemic and the
related response from CAE, governments, regulatory authorities,
businesses and customers, there is inherently more uncertainty
associated with CAE's assumptions. Accordingly, the assumptions
outlined in this press release, and in the documents referenced
herein, and, consequently, the forward-looking statements based on
such assumptions, may turn out to be inaccurate.
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SOURCE CAE INC.