Richmond, BC - MacDonald, Dettwiler and Associates Ltd. (TSX: MDA), a provider of essential information solutions, announced today that it has completed and formally closed the previously announced acquisition of Space Systems/Loral, Inc. (SS/L). The combination of MDA and SS/L creates a leading global communications and information company.
The acquisition is being financed by a combination of cash on hand, a three-year promissory note of US$101,000,000, a new twelve-year senior secured note of US$250,000,000 with two major U.S. financial institutions, an existing senior secured note of US$100,000,000, and approximately $600,000,000 of variable rate term and revolving loans under a new four-year US$850,000,000 senior secured syndicated credit facility.
Bank of America Merrill Lynch acted as lead financial advisor to MDA in connection with the transaction. RBC Capital Markets and BMO Capital Markets also provided financial advice to MDA related to this transaction.
Loral Space & Communications Inc., the parent company of SS/L as at September 30, 2012, expects to issue its third quarter U.S. GAAP financial results on or about November 8, 2012.
To access MDA’s original June 26, 2012 announcement, please visit the following link: MDA announces transformational U.S. acquisition
MDA is a unique global communications and information company providing operational solutions to commercial and government organizations worldwide.
MDA’s business is focused on markets and customers with strong repeat business potential. In addition the Company conducts a significant amount of advanced technology development.
MDA’s well-established global customer base is served by more than 5,000 employees operating from 18 offices located in the United States, Canada, and internationally.
The Company’s common shares trade under the symbol TSX:MDA.
Caution Regarding Forward-Looking Information and Other Matters
This press release contains certain forward-looking statements and information which reflect the current view of MacDonald, Dettwiler and Associates Ltd. (the “Company” or “MDA”) with respect to future events and financial performance. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may”, “will”, “would”, “could”, “should”, “expect”, “intend”, “estimate”, “anticipate”, “plan”, “foresee”, “believe” or “continue”, or the negatives of such terms or variations of them or similar terminology. The forward-looking statements in this press release are based on MDA’s current expectations, estimates, projections and assumptions made in light of its experience and perception of historical trends. Forward-looking statements are subject to risks and uncertainties, many of which are beyond MDA’s control and the effects of which can be difficult to predict. MDA’s actual results of operations could differ materially from historical results or current expectations.
With regard to MDA’s acquisition of Space Systems/Loral, Inc. (“SS/L”), there can be no assurance that MDA will realize the anticipated benefits or results due to a variety of factors, including among other things: the ability to promptly and effectively integrate the businesses of MDA and SS/L; higher than anticipated integration costs; diversion of management time on acquisition-related issues; and failure to obtain the consent or other agreement of certain counterparties whose consent or agreement is required in order for MDA to acquire certain business relationships. The anticipated benefits from the acquisition, such as it being accretive to earnings, expanding the Company’s presence and creating synergies and new opportunities for growth, may not be realized in the time frame anticipated or at all as a result of several factors including changes in general economic and market conditions, customer demand for the Company and SS/L’s products and services, laws and regulations and their enforcement, and the degree of competition in the geographic and business areas in which SS/L operates. Assumptions about current and expected capital requirements, SS/L revenues and expenses, the potential for earnings growth as well as costs associated with the transaction and expected synergies were material factors considered in estimating the internal rate of return to MDA and its estimate of the acquired business being accretive to MDA’s earnings. Assumptions about MDA’s integration plan, the efficiency and duration of integration and the alignment of organizational responsibilities were material factors considered in estimating transaction and integration costs.
Other risks that could cause actual results to differ from current expectations include: changes in government priorities, funding levels, contracts and regulations; failure of third parties and subcontractors to complete contracts for which the Company or SS/L is the prime contractor; risks of performance on firm fixed-price construction contracts; changes in estimates of total revenues and costs on contracts; potential for product liability or the occurrence of defects in software and other products and resulting loss of revenue and loss of the Company’s or SS/L’s reputation; quality issues and failure of systems to meet performance requirements; failure of the Company to manage its acquisitions and breaches of contracts and indemnities and related risks on divestitures; partial or complete satellite failure; dependence on electronic systems and data and system security threats; detrimental reliance on third parties for data; dependence on key employees, potential for work stoppages and lack of oversight over a U.S. proxy board and management; failure to anticipate changes in technology, technical standards and offerings or comply with the requisite standards; failure to maintain technological advances and market positions; significant competition; potential infringement of the intellectual property rights of others through licensed software or otherwise; inadequate protection of the Company’s intellectual property rights; exposure to foreign currency fluctuations; changes in economic and political conditions; inability of suppliers or subcontractors to effect technology transfer; changes in customer security requirements and the resulting cancellation of contracts; failure to maintain business alliances; uncertainty in financing arrangements; failure of counterparties in financing arrangements and financial derivative contracts; wrongful call on letters of credit and performance bonds; and insufficient insurance against material claims or losses. We caution that the preceding list is not exhaustive of all possible risk factors and other factors could also adversely affect MDA’s results. Accordingly, readers are cautioned that events or circumstances could cause results to differ materially from those predicted, forecasted or projected.
You are referred to the risk factors described in MDA’s most recent annual Management’s Discussion and Analysis, Annual Information Form and other documents on file with the Canadian securities regulatory authorities, available under the Company’s profile on SEDAR, www.sedar.com or on the Company's website at www.mdacorporation.com. All such factors should be considered carefully, as well as other uncertainties and potential events, and the inherent uncertainty of forward-looking statements, when making decisions with respect to MDA. The forward-looking statements and information contained in this press release represent MDA’s views only as of today’s date. All such statements are made pursuant to the “safe harbour” provisions of applicable Canadian and U.S. securities laws. MDA disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by law, rule or regulation. You should not place undue reliance on forward-looking statements.
The Toronto Stock Exchange has neither approved nor disapproved the form or content of this release.