Canadarm maker MDA returns to Canada with $1 billion sale to investors including Jim Balsillie
A group of investors including billionaires John Risley and Jim Balsillie are buying MDA, the iconic space robotics company that built the Canadarm.
The deal, valued at $1 billion in equity and debt, will return MDA to Canadian control and will also see the company’s headquarters move back north of the border, the investors said in a release.
MDA was founded in 1969 as MacDonald, Dettwiler and Associates, and became part of Colorado-based Maxar Technology Holdings as part of a merger in 2017.
At one time, MDA was deemed sufficiently important to the national interest that then-industry minister Jim Prentice blocked the sale of part of the company in 2008, the first time the federal government had ever used its power under the Investment Canada Act.
The current deal is being led by investment firm Northern Private Capital, which is led by Risley and Andrew Lapham.
MDA, which has helped construct part of the International Space Station, will operate as a stand-alone company within NPC’s portfolio following the transaction. MDA was the builder of Canadarm2, the robotic arm that has served the International Space Station since 2001, according to the Canadian Space Agency.
“Over its 50-year history, MDA has grown from a B.C.-based start-up into a world-class space technology company and an anchor of Canada’s space program,” Risley said in the release. “We are thrilled to partner with Mike Greenley and the rest of the MDA team and are excited about the significant growth potential we see for the company. As a Canadian, I am so proud this iconic Canadian company will once again be owned and controlled in Canada.”
The MDA businesses are expected to generate approximately US$370 million in revenue and US$85 million in adjusted earnings before interest, tax, depreciation and amortization in 2019. The revenue includes US$78 million of inter-company sales to other Maxar entities. The sale is conditional on regulatory approvals and reviews in Canada and the U.S.
The deal to repatriate the company comes at a time when space technology is increasingly seen as a hot area for growth and entrepreneurship, with companies like SpaceX, Blue Origin and others making plays to offer commercial space services.
The influential University of Toronto tech incubator, the Creative Destruction Lab, recently launched a space program to foster startups in this area.