CAE to acquire Bell Aliant’s xwave Defence, Security and Aerospace business
Aug. 6, 2008, Montrael and Halifax- CAE and Bell Aliant Regional Communications Income Fund have announced that CAE has signed an asset purchase agreement to acquire Bell Aliant's Defence, Security and Aerospace business unit.
August 6, 2008 By Carey Fredericks
Aug. 6, 2008, Montrael and Halifax- CAE and Bell Aliant Regional Communications Income Fund have announced that CAE has signed an asset purchase agreement to acquire Bell Aliant's Defence, Security and Aerospace (DSA) business unit, currently operated by the xwave division of Bell Aliant Regional Communications, Limited Partnership. The purchase price paid on closing will be C$15.1 million with an additional C$11.0 million to be paid contingent upon the occurrence of certain events for a potential total purchase price of $26.1 million.
xwave's DSA team supplies real-time software and systems for simulation, training, defence, and integrated lifecycle information management for the aerospace and defence industries. The division employs approximately 200 people in Ottawa, Ontario; Halifax, Nova Scotia; and Esquimalt, British Columbia.
"We are happy to expand CAE's defence capabilities and footprint across Canada, particularly in Ottawa, Atlantic Canada and British Columbia," said Marc Parent, CAE's Group President, Simulation Products and Military Training & Services. "xwave DSA is already a valued partner of CAE on several programs. By joining CAE and our CAE Professional Services team, xwave's DSA professionals will provide us with a portfolio of complementary capabilities, including systems integration that will enhance CAE's ability to serve Canada as well as the global defence and homeland security markets."
Over the past year, Bell Aliant conducted a strategic review of its DSA business and concluded that to further grow the business, it should be operated by an organization that supports large scale, multi-year and international projects in this sector.
"I am pleased that CAE, a Canadian-based company and world leader in the defence and civil aviation industries, will be leading our DSA business through the next phase of its growth," said Stephen Wetmore, President and CEO of Bell Aliant. "We look forward to working with CAE, our employees and clients through this transition."
This acquisition is an important step in CAE's strategy to expand the use of modelling and simulation throughout the defence systems lifecycle. xwave's DSA unit offers a suite of training products focused on rear crew trainers and mission rehearsal systems that will further enhance CAE's military training and services offerings. The acquisition will also allow CAE to add new customers and capabilities in the electronic warfare market, the land command and control market, and significantly enhance its presence in the C4ISR (command, control, communications, computers, intelligence, surveillance and reconnaissance) domain.
Some of the key programs involving xwave's DSA include a range of air, land and sea programs in Canada, such as the Maritime Helicopter Program, where DSA is providing lifecycle support capabilities. In addition, the DSA team's electronic warfare technology is currently used by Canadian troops in Afghanistan. The xwave DSA team is also part of the Lockheed Martin team pursuing the Canadian Navy's Halifax Class Modernization Program.
The transaction is subject to customary closing conditions and is expected to close by the end of the calendar year.
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