(Montreal) A major contract for the Montreal plant of satellite antenna manufacturer MDA can finally go ahead, now that its client, Telesat, has completed its financial package.
The $2.1 billion contract, the largest in MDA’s history, sees it launch new digital satellite technology, says company president and CEO Mike Greenley. in an interview on Friday.
“This contract is so big that it allows this product to be marketed with a large production volume. This is a great starting point that will put us on a good track to sell this product to other customers. »
The agreement provides that 198 satellites will be built in Sainte-Anne-de-Bellevue on the island of Montreal. The contract includes options to purchase up to 100 additional satellites. These satellites in low orbit will notably make it possible to connect remote regions to the Internet.
MDA has enough employees to start production “right now,” said the executive. “Over the next two to three quarters, we will be hiring a significant number of people as a result of this contract. Taking into account the Telesat project and future digital satellite contracts, we will add a few hundred new employees. »
Telesat’s first satellites are expected to be sent into orbit in 2026 with a view to offering commercial service in 2027. In 2021, Telesat anticipated a launch in 2023.
Télésat had been dangling the project since 2021, but the company did not yet have sufficient funds to confirm the order, despite a promise of financial support of around 2 billion from the federal government and Quebec.
At Telesat, it is explained that the new digital technology will reduce the bill for the project by nearly 2 billion US compared to previous estimates. “This is a significant saving and greatly improves the project’s estimated profitability,” Telesat said in a statement.
Lower costs don’t come with lower quality, says Greenley. “We can adjust satellite performance in real time to target communication where and when the consumer needs it. This gives Telesat great flexibility to offer optimal communication to their customers. »
Overall, the program is worth US$3.5 billion ($4.69 billion). Telesat says it will fund the project to the tune of US$1.6 billion ($2.14 billion).
Investors reacted well to the news as MDA’s stock gained $1.97, or 23.34%, to $10.41 on the Toronto Stock Exchange in the morning.