Ownership of the Canada's most visible contribution to space exploration is moving to the United States.
Richmond's MacDonald, Dettwiler and Associates Ltd. (TSX:MDA) is selling its glamorous space and robotic divisions to Alliant Techsystems Inc. for $1.325 billion in cash.
The asset sale to a major U.S. defence contractor involves all of MDA's space-related information systems, including the technology behind the space shuttle's Canadarm, the international space station's Canadarm2, its robotic division and its satellite technology.
More than 1,900 MDA employees, primarily from the company's space missions facility in Brampton, Ontario, as well as about 100 employees in B.C. will be affected by the ownership change.
MDA said it's selling its space-related assets to focus on expanding its information products division, which provides key real estate and financial information to industry professionals in the U.K., the U.S. and B.C.
MDA is responsible for the technology behind BC Online, which provides real estate and corporate data to the public, and the U.K.'s home information packs required for any real estate sale in the U.K.
Speaking to analysts in a conference call shortly after the Alliant deal was announced, MDA president and CEO Daniel Friedmann said the company's attempts to expand its information products division through acquisition have been hampered by a relatively low stock valuation over the past few months.
The Alliant deal will give MDA roughly $1.2 billion in cash to acquire larger strategic targets in the information products field. The company is planning to expand further into the U.S. and Europe, and increase its market share of home information packs in the U.K. and Ireland.
MDA's shares rose 16% by midday Wednesday to $49.30 from Tuesday's close of $42.51 prior to the sale's announcement.
The deal, which has been approved by MDA's board, is expected to close in late March or early April, pending customary closing conditions and regulatory and shareholder approval.
MDA's share price range during the past week: between $42.35 and $42.66; 52-week high: $53.82; 52-week low: $37.38.