CAE INC - CAE STOCK NEWS

CAE announced the completion of a private placement of subscription receipts valued at C$700 million (approx. US$550 million) to Caisse de dépôt et placement du Québec and GIC Private Limited. The proceeds will fund a portion of the acquisition of L3Harris Technologies' Military Training business. Each receipt converts into a common share of CAE upon closing, expected in the second half of 2021, pending regulatory approvals. The securities are not registered in the U.S. or Canada.

Caisse de dépôt et placement du Québec (CDPQ) has announced a CA$475 million investment in CAE, a leading provider in training solutions. This funding will facilitate CAE's acquisition of L3Harris Technologies' defense training and simulation business. Following this acquisition, CDPQ is set to become CAE's largest shareholder. The deal is strategic for CAE, enhancing its role in the defense sector while solidifying its leadership in civil aviation and healthcare. GIC Private Limited is also contributing with a CA$225 million investment.

CAE has announced a definitive agreement to acquire L3Harris’ Military Training business for US$1.05 billion, aiming to enhance its military training capabilities in the US. The acquisition, expected to close in the second half of 2021, is projected to bring low-teens percentage EPS accretion in the first full year, along with annual cost synergies between C$35 million and C$45 million. This strategic move will expand CAE's offerings across air, land, sea, space, and cyber domains.

CAE reported third-quarter fiscal 2021 revenue of $832.4 million, an 18% increase from the second quarter but a 10% decline year-over-year. EPS reached $0.18, a significant recovery from a loss last quarter, yet down 51% from last year. Operating profit was $82.9 million, down 46% from last year. CAE made three acquisitions and raised $495.3 million through equity offerings to enhance its market position. Despite a solid backlog of $7.8 billion, the ongoing pandemic continues to hinder commercial aviation recovery, impacting future revenue and performance.

CAE has announced that its Chair, the Honourable John Manley, has received the 2021 Institute of Corporate Directors Fellowship Award, recognizing his substantial contributions to corporate governance in Canada. Manley has been with CAE since 2008, where he has played a critical role in promoting sound governance practices and fostering ESG initiatives, contributing to the company's record financial performance. His leadership style emphasizes trust and empowerment, enhancing CAE's global standing and innovation in high-technology solutions across various sectors.

CAE has signed a contract with PYURE to assemble air sanitizers that significantly destroy the COVID-19 virus, as validated by an independent U.S. lab. The partnership aims to produce 55,000 units in the first year, addressing the strong demand in hospitals and schools. PYURE's technology, which generates hydroxyls and organic oxidants, proved effective in reducing airborne and surface virus levels by 99%. This contract not only enhances CAE's role in pandemic response but also supports job retention in Montreal.

CAE announced the second edition of the CAE OneWorld virtual conference and tradeshow set to commence on February 9, 2021. This free event aims to showcase CAE's innovative digital solutions in critical market segments, with a month-long online presence. Keynote presentations will include insights from President and CEO Marc Parent and Group President Dan Gelston. The conference will cover critical topics such as digital immersion and healthcare innovations, featuring a special CAE Healthcare zone to demonstrate simulation-based solutions.

CAE USA has been awarded a competitive recompete contract by the United States Air Force (USAF) to provide KC-135 training services, valued at over US$275 million over eight years. This includes classroom and simulator training for over 4,500 KC-135 crew members annually at 12 U.S. and international sites. The contract allows CAE to continue supporting KC-135 operations, including updates and upgrades to training equipment. This achievement reinforces CAE's longstanding relationship with the USAF since it became the prime contractor in 2010.

CAE has announced its acquisition of Merlot Aero Limited for US$25 million, plus up to US$10 million in earn-out incentives. This strategic move strengthens CAE's digital flight operations portfolio and expands its addressable market in airline crew management and optimization software. The acquisition is CAE's third since November and underscores the company's commitment to unifying digital flight operations. Marc Parent, CEO of CAE, emphasized the growing demand for these services accelerated by COVID-19.