CAE Inc. Divests Healthcare Business to Madison Industries in a Strategic Move

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CAE Inc. Divests Healthcare Business to Madison Industries in a Strategic Move

CAE Inc., a renowned name in the aviation and simulation sector, has announced a pivotal business decision. The company has entered into a definitive agreement to sell its Healthcare business to Chicago's Madison Industries. The deal is valued at an enterprise value of C$311 million, subject to standard adjustments.

Key Insights from the Announcement:

• Strategic Divestiture: CAE's decision to part with its Healthcare business is seen as a strategic move to streamline its portfolio. Marc Parent, President and CEO of CAE, expressed pride in the contributions CAE Healthcare has made towards patient safety. He believes that under Madison Industries, the Healthcare business is poised for further growth, especially in the realm of simulation-driven patient safety and quality outcomes.

• Focus on Core Markets: Parent further elaborated that this divestiture allows CAE to efficiently allocate capital and resources to tap into growth opportunities in its larger core simulation and training markets.
• Madison Industries' Vision: Larry Gies, Madison Industries' founder and CEO, emphasized the company's mission to make the world safer, healthier, and more productive. Gies expressed enthusiasm about building on CAE Healthcare's legacy of innovation. With a skilled workforce spanning the United States, Europe, and cutting-edge R&D capabilities in Quebec, Madison Industries aims to fast-track advancements in simulation and quality outcomes.

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• Transaction Details: The sale, which is contingent upon customary regulatory approvals and other closing conditions, is anticipated to conclude before the end of the fiscal year 2024. The proceeds from the sale will primarily be used to expedite deleveraging and to bolster CAE's focus on technology advancement, market leadership, and cost optimization within its core training and simulation markets.
• Advisory Role: National Bank Financial Inc. has been engaged as the exclusive financial advisor for CAE in this transaction.

About CAE Inc.:

CAE is a technology-driven company that specializes in digitalizing the physical world through software-based simulation training and critical operations support solutions. With a global presence spanning over 40 countries and approximately 250 sites, CAE is dedicated to ensuring safety in critical roles. The company boasts over 75 years of pioneering industry-firsts, offering high-fidelity flight, mission, and medical simulators powered by advanced digital technologies.

In Conclusion:

CAE Inc.'s decision to sell its Healthcare business marks a significant strategic shift, emphasizing its commitment to its core aviation and simulation sectors. As the industry landscape evolves, CAE continues to position itself as a leader, focusing on innovation and global market leadership.