Shares of MacDonald, Dettwiler and Associates fell sharply on the Toronto Stock Exchange on Thursday after the Canadian government signaled that it would block the company’s sale of its space division to an American defense contractor.
Shares of the Richmond, BC-based company, which had been trading at a high of $47 Canadian on Wednesday, fell to $42.85 Canadian on Thursday after Industry Minister Jim Prentice indicated that the”investment is not likely to be of net benefit to Canada.” The stock recovered slight to finish the week at $43.03 Canadian.
MDA had planned to sell its space division to U.S.-based Alliant Techsystems (ATK) for $1.325 billion in order to focus on its information systems business. Stockholders overwhelmingly approved the sale last month.
However, opponents said the sale would devastate the Canadian space industry, give Americans access to taxpayer-subsidized technology, and compromise the nation’s sovereignty. MDA built the Canadarms and the Dextre robot for the space shuttle and International Space Station, both funded by the Canadian government.
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