AirAsia Extends Business Partnership with CAE to the Next Level

25th Aug 2017

Biggest Asian low budget carrier AirAsia and the global leader in civil aviation, defense, security and healthcare training CAE have agreed a sale and purchase agreement for the Asian Aviation Centre of Excellence. At the moment, AACE is a 50:50 joint venture between the two parties.

Following the transaction of $100 million, which will also include an earn-out, CAEO will get full control over training centers in Sepang (Malaysia), Ho Chi Minh City (Vietnam) and Singapore. The agreement also states that CAE will get a share in the Philippine Academy of Aviation and Training (PAAT). PAAT is a JV between AACE and Philippine-based airline Cebu Pacific.

In addition, CAE will keep its role as the exclusive training partner for the entire AirAsia Group. The current contract for training services CAE provides to all airlines in the group is extended until 2036.

Tony Fernandes, Chief Executive Officer at AirAsia Group said:

We've had CAE as our training partner of choice for many years now and it has been a great success. Our first MPL cadets trained by CAE are now flying as captains, and we put our full trust in CAE to fulfill our training needs at the highest quality level, as we continue to grow. AirAsia is rich in assets but our core business is passenger service and ancillary, and we will continue to regularly dispose of non-core investments and dividend most of it out, subject to board approval. This stake sale is just part of our long-term plan to monetize all our assets. We are also working on several other divestments of valuable assets including our leasing arm, which is imminent.

Marc Patent, CEO and President at CAE added:

CAE and AirAsia have been close partners since 2004, and we created AACE together in 2011. This new agreement is a natural evolution of our relationship and a win-win for both organizations. It allows AirAsia to concentrate on its core business by completely outsourcing its training needs to CAE, and it allows CAE to expand its footprint in Asia Pacific, the fastest-growing aviation market. We are very proud of what we have accomplished with AirAsia in creating AACE. We'd like to thank AACE employees for setting the standard and creating a great training experience, and we welcome them to CAE. Together we will continue to shape the future of training.