- Vertical integration of SatixFy expected to further enhance
the MDA Space end-to-end satellite offering as demand for digital
constellations grows
- MDA Space to pay US$2.10 per
SatixFy share, representing a 75% premium to SatixFy's share price
on March 31, 2025
BRAMPTON, ON and REHOVOT,
Israel, April 1,
2025 /PRNewswire/ - MDA Space Ltd. (TSX: MDA), a
trusted mission partner to the rapidly expanding global space
industry, and SatixFy Communications Ltd. (NYSE American: SATX), a
leader in next-generation satellite communication solutions based
on in-house-designed chipsets, today jointly announced that they
have entered into a definitive agreement (the "Transaction
Agreement") under which MDA Space will acquire all outstanding
shares of SatixFy in an all-cash transaction for US$2.10 per share. The transaction, which
represents an equity value for SatixFy of approximately
US$193 million (approximately
C$278 million), is expected to
further enhance the end-to-end satellite systems offering of MDA
Space as demand for next generation digital satellite
communications continues to accelerate.
Next Generation Chipsets for Satellite Communications with
Robust Patent Portfolio
Founded in 2012, SatixFy is a supplier of cutting-edge
semiconductors and solutions for the space and the satellite
communications value chain. SatixFy's technology enables satellite
broadband and direct-to-device constellations with its radiation
hardened digital beamformers enabling them to generate hundreds of
beams, designed to significantly improve satellite performance and
decrease cost. SatixFy has invested approximately US$270 million in research and development to
date, and once closed, the transaction will bring to MDA Space a
differentiated technology portfolio including more than 60 patents
issued and pending, as well as a talented and largely specialized
technical employee base of approximately 165 people globally. In
addition to chips to support satellite payload solutions and
satellite communications, the SatixFy portfolio includes gateways,
multi-beam digital antennas, user terminals and modems.
"With this acquisition MDA Space is taking a logical next step
to further reinforce our technical differentiation as the global
market transitions from analog to digital satellite technology,"
said Mike Greenley, Chief Executive
Officer of MDA Space. "Similar to MDA Space, SatixFy is an
innovation company at its core, and bringing these two highly
skilled teams together adds complementary expertise and technology
that will allow us to further enhance our value proposition for
current and future customers by providing vertically integrated and
differentiated digital satellite solutions."
"SatixFy has consistently aimed to revolutionize the market with
digital chip-based solutions while establishing a world-leading
space technology company. Joining MDA Space marks a significant
milestone in that journey," said Nir
Barkan, Chief Executive Officer of SatixFy. "This
transaction is a testament to the innovation and dedication of our
employees over the past decade. It will provide the scale,
resources, and stability needed to continue delivering
groundbreaking solutions for our customers."
Strategic Highlights
The market for software-defined digital satellite constellations
is rapidly expanding, driven by increased demand for
satellite-based broadband, direct-to-device connectivity and the
Internet of Things. Market research firm NSR forecasts that over
89% of all communications satellites built in the ten years between
2023 and 2032 will include some level of software-defined
technology.
The acquisition of SatixFy is expected to enhance MDA Space's
capabilities in this growing digital satellite communications
market by:
- Adding complementary technology and a rich IP portfolio to
enable end-to-end satellite communications solutions and expand
offerings by combining MDA Space technology and capabilities in
digital LEO and MEO satellites (MDA
AURORATM) with SatixFy's space grade chips and
communications systems;
- Vertically integrating a key and differentiated technology
provider for MDA Space Satellite Systems business;
- Adding a highly specialized and complementary technical team to
MDA Space; and
- Aligning the technology roadmap for MDA Space next generation
software-defined digital satellites to continue to meet evolving
needs of customers.
Transaction Details
MDA Space will acquire all outstanding ordinary shares of
SatixFy for US$2.10 in cash per
share, representing a 75% premium to SatixFy's closing price on
March 31, 2025 and a 52% premium to
SatixFy's 30-day volume weighted average price as of March 31, 2025. As part of the transaction, MDA
Space also intends to retire SatixFy's existing debt of
approximately US$76 million
(approximately C$109 million)
immediately upon closing, which represents a total cash
consideration of approximately US$269
million (approximately C$387
million) for the transaction.
The transaction is expected to be accretive to MDA Space
adjusted earnings in 2027 which will represent the second full year
of MDA Space ownership. The transaction is also expected to realize
cost savings within 12 months of closing, primarily as a result of
the vertical integration of space chips and the elimination of
public company costs.
The transaction is expected to close in the third quarter of
2025 subject to customary closing conditions and required
regulatory approvals.
Transaction Supported by Boards of Directors and Major
SatixFy Shareholders
The transaction has been unanimously approved by the Boards of
Directors of MDA
Space and SatixFy, as well as a Special Committee and the Audit
Committee of SatixFy.
Certain of SatixFy's directors, officers and significant
shareholders, holding an aggregate of approximately 57% of the
outstanding ordinary shares of SatixFy, have entered into voting
support agreements in favour of the transaction.
Additional Information
The Transaction Agreement includes a 45-day go-shop period
extending until May 16, 2025 (the
"Go-Shop Period"), during which time SatixFy, with the assistance
of its financial adviser, will, subject to the requirements and
limitations set forth in the Transaction Agreement, including
matching rights of MDA Space, be permitted to actively solicit,
evaluate and enter into negotiations with third parties that
express an interest in acquiring SatixFy with a view to obtaining a
potential Superior Proposal (as defined in the Transaction
Agreement). The Transaction Agreement includes customary break-fees
in certain circumstances.
The transaction is subject to, among other things, regulatory
approvals and requires the affirmative vote of the holders of
the outstanding SatixFy Shares, in accordance with the
applicable voting requirements under the Israeli Companies Law at a
shareholders' meeting of SatixFy expected to be held
in the second quarter of 2025, as well as other customary closing
conditions. Approval of the shareholders of MDA Space
is not required.
Advisors
Citi is serving as exclusive financial advisor to MDA Space and
Norton Rose Fulbright Canada LLP is serving as legal counsel to MDA
Space. TD Cowen is serving as exclusive financial advisor to
SatixFy and Goldfarb Gross Seligman
& Co. and Sullivan & Worcester LLP are serving as legal
counsel to SatixFy.
Conference Call
MDA Space will host a call and webcast to discuss the
transaction on Tuesday, April 1, 2025
at 10:00 a.m. ET. Interested parties
can join the call by dialing 416-945-7677 (Toronto area) or 1-888-699-1199 (toll-free
North America) or +44-800-279-7040
(toll-free United Kingdom) and
entering the conference ID 39693. A live webcast of the conference
call and an accompanying slide presentation will be available at
https://mda-en.investorroom.com/events-presentations.
A replay of the conference will be archived on the MDA Space
website following the call. Parties may also access a recording of
the call which will be available until April
8, 2025, by dialing 1-888-660-6345 and entering the passcode
39693 #.
Forward-Looking Statements
This news release contains forward–looking information within
the meaning of applicable securities legislation, which reflects
MDA Space's and SatixFy's current expectations regarding future
events.
Forward-looking statements in this news release include, but are
not limited to, statements with respect to: accretive financial,
market and product synergies associated with the transaction;
statements made herein (including with respect to NSR forecasts)
with respect to the anticipated benefits (if any) of the
transaction; the anticipated effect of the transaction on MDA
Space's and SatixFy's future growth, costs, opportunities and
strategy going forward; the consideration to be received by
SatixFy's shareholders; the go-shop process during the Go-Shop
Period (including receipt of any Superior Proposal and the
resulting effects on MDA Space and the transaction consideration);
the payment of a breakup fee by either party (if at all);
compliance by MDA Space and SatixFy with various covenants
contained in the transaction Agreement; the receipt of regulatory
approvals and the satisfaction of the closing conditions of the
transaction; the anticipated timing for SatixFy's shareholders'
meeting and completion of the transaction; and statements made by
the Chief Executive Officer of MDA Space and the Chief Executive
Officer of SatixFy. In particular, there can be no assurance that
the transaction will be completed on the terms described herein, if
at all.
Forward–looking information is based on a number of assumptions
and is subject to a number of risks and uncertainties, many of
which are beyond the control of MDA Space and SatixFy, which could
cause actual results and events to differ materially from those
that are disclosed in or implied by such forward–looking
information, including: approvals required in connection with the
transaction; compliance with the voting support agreements; the
outcome and effects of the go-shop process; the satisfaction or
waiver of the closing conditions of the transaction (if at all);
adverse changes in applicable laws or regulations; delay or
inability of MDA Space to pay the consideration contemplated by the
Transaction Agreement; expected growth; results of operations;
performance; industry trends and growth opportunities. While MDA
Space and SatixFy consider these assumptions to be reasonable,
based on information currently available, they may prove to be
incorrect. Additional risks and uncertainties applicable to MDA
Space include, but are not limited to, the factors discussed under
"Risk Factors" in the MDA Space Annual Information Form (AIF) dated
March 7, 2025 and available on SEDAR+
at www.sedarplus.com. Additional risks and uncertainties applicable
to SatixFy include, but are not limited to, the factors discussed
under "Risk Factors" in SatixFy's Annual Report on Form 20-F for
the year ended December 31, 2023
filed with the SEC on March 29, 2024,
as amended, and other documents filed with or furnished to the SEC
which are available on the SEC's website, www.sec.gov. Neither MDA
Space nor SatixFy undertakes any obligation to update such
forward–looking information, whether as a result of new
information, future events or otherwise, except as expressly
required by applicable law.
In connection with this transaction, SatixFy intends to submit
relevant materials to the SEC and other governmental or regulatory
authorities, including a proxy statement and form of proxy card.
Investors are urged to read these materials carefully when they
become available because they will contain important information
about SatixFy and this transaction. The proxy statement, proxy card
and certain other relevant materials (when they become available)
and any other documents submitted by SatixFy to SEC may be obtained
free of charge at the SEC's website at http://www.sec.gov.
Investors are urged to read the proxy statement and the other
relevant materials carefully when they become available before
making any voting or investment decision with respect to this
transaction.
ABOUT MDA SPACE
Building the space between proven and possible, MDA Space
(TSX:MDA) is a trusted mission partner to the global space
industry. A robotics, satellite systems and geointelligence pioneer
with a 55-year+ story of world firsts and more than 450 missions,
MDA Space is a global leader in communications satellites, Earth
and space observation, and space exploration and infrastructure.
The MDA Space team of more than 3,400 space experts in Canada, the US and the UK has the knowledge
and know-how to turn an audacious customer vision into an
achievable mission – bringing to bear a one-of-a-kind mix of
experience, engineering excellence and wide-eyed wonder that's been
in our DNA since day one. For those who dream big and push
boundaries on the ground and in the stars to change the world for
the better, we'll take you there. For more information, visit
www.mda.space.
ABOUT SATIXFY
SatixFy develops chips and systems that serve the full satellite
communication value chain from gateways through payload subsystems
and terminals. Our cutting-edge space grade chipset supports
next-generation satellite communications systems, including
satellite multi-beam digital space antennas, space processors flat
panel user terminals and modems, based on powerful in-house
designed chipsets. SatixFy's products include modems that feature
Software Defined Radio (SDR) and Fully Electronically Steered Multi
Beam Antennas (ESMA) that support the advanced communications
standard DVB-S2X and RCS2. SatixFy's innovative ASICs improve the
overall performance of satellite communications systems, reduce the
weight and power requirements of terminals and payloads, and save
real estate for gateway equipment. SatixFy's advanced VSATs and
multi-beam fully electronically steered antenna arrays are
optimized for a variety of mobile applications and services,
prepared for multi-orbits LEO, MEO and GEO satellite communications
systems, for aero/in-flight connectivity systems,
communications-on-the-move applications and more. For more
information, please visit www.SatixFy.com.
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