M&A

MDA clears regulatory hurdle for $2.4B DigitalGlobe deal

MacDonald, Dettwiler and Associates has cleared one of the final regulatory hurdles for its estimated $2.4 billion acquisition of DigitalGlobe and now expects to close the deal next week by Oct. 6 pending other closing conditions.

MDA said Friday the Committee on Foreign Investment in the U.S. completed its review of the transaction and there are no outstanding issues over the deal related to national security. Both companies in July withdrew and re-filed their notice for review in July to CFIUS, an inter-agency committee that reviews impacts of foreign investments into U.S. businesses on national security.

While MDA’s operating headquarters are in San Francisco, CFIUS had to review the deal as the space technology and information services company’s corporate headquarters are in the Vancouver, Canada metropolitan region. MDA opened the San Francisco office as part of its larger U.S. Access Plan to gain full eligibility for government space contracts including those at the classified level.

The DigitalGlobe acquisition is also part of that plan to add its Earth imagery services and satellite systems with MDA’s satellite manufacturing portfolio that includes Silicon Valley-based Space Systems Loral. DigitalGlobe will become a subsidiary alongside SSL of SSL MDA Holdings, the San Francisco-based operating entity of MDA.

MDA and DigitalGlobe expect the combined company to generate $2 billion in annual revenue with one-fourth of sales in the U.S. government market. MDA will assume DigitalGlobe’s $1.2 billion in net debt to bring the transaction’s enterprise value to $3.6 billion.

Also, MDA received clearance from the New York Stock Exchange to list the company’s stock on the NYSE for trading under the “MDA” ticker symbol. That stock includes shares DigitalGlobe stockholders will receive after the deal closes.

Upon closure, MDA will become a dual-listed company on the NYSE and Toronto Stock Exchange. The company has traded on the TSE since July 2000.

About the Author

Ross Wilkers is a senior staff writer for Washington Technology. He can be reached at rwilkers@washingtontechnology.com. Follow him on Twitter: @rosswilkers. Also find and connect with him on LinkedIn.

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