MacDonald Dettwiler and Associates has warned that the Canadian government’s decision to block the sale of its space division to an American defense contractor Alliant Technosystems could backfire, resulting in the loss of jobs and key technologies, the Financial Post reports.
MDA wants to sell its space division to ATK for $1.3 billion in order to focus on its fast growing real-estate information business. If the sale does not go through, company officials say they would have three options:
- purchase an American-based company to gain access to the U.S. market, draining funds from its information business;
- hire hundreds of American workers so it can gain access to U.S. contracts, thus sending jobs south of the border;
- collaborate with a U.S. company, with the risk of having its technologies stolen.
Last month, Industry Minister Jim Prentice rejected the sale on the grounds that it would have no net benefit for Canada. He sided with critics who say that the sale would damage the nation’s space program, sell off taxpayer-funded technology to the United States, and possibly block Canadian access to data from the Radarsat 2 satellite.
MDA has 30 days to convince Prentice that he is wrong; that period expires on Thursday, May 8. MDA has requested a meeting with Prentice to plead its case.
The Times Colonist reports that MDA has not ruled out selling Radarsat 2 to the Canadian government if it would salvage the deal. Critics of the deal say that Canada risks losing access to data from the satellite due to U.S. law. The government invested $445 million in Radarsat 2, while MDA chipped in $80 million. It is not clear whether this arrangement would be acceptable to ATK.
CBC News has an analysis of the MDA sale, which it says has spotlighted a larger lack of direction in the Canadian space program.
“Canada has stumbled in the dark for several years now,” John Keating, president of Ontario space hardware producer COM DEV, told the CBC. “I think that this whole episode with MDA and ATK has woken people up to the fact that we have something really quite extraordinary here, and we should be proud of it and invest in it.”
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