MDA Space (MDA) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition of SatixFy enhances digital satellite capabilities, expands end-to-end solutions with advanced chipsets, IP, and a specialized technical team, and aligns with the transition from analog to software-defined digital satellites.

• Vertically integrates SatixFy's space chips and ground products, enabling differentiated, in-house technology and strengthening the technology roadmap.

• Secures a critical element of the supply chain and supports competitiveness and future growth.

• Builds on a long-standing relationship and prior acquisition of SatixFy's UK payload division, facilitating integration.

• Positions the company to address the proliferation of LEO/MEO/GEO constellations and meet evolving customer needs.

Financial terms and conditions

• Purchase price is US$2.10 per share, a 75% premium to the prior close, valuing equity at US$193 million and total cash consideration at US$269 million, including retirement of US$76 million in SatixFy debt.

• Funded through cash on hand and revolving credit facility; pro forma leverage expected at 1.2x net debt to LTM adjusted EBITDA.

• Break fees are US$5 million during the go-shop period and US$10 million after.

• Go-shop period allows SatixFy to solicit superior proposals for 45 days.

Synergies and expected cost savings

• Cost savings expected within 12 months of closing, mainly from vertical integration and elimination of public company costs.

• Transaction expected to be accretive to adjusted earnings in 2027, the second full year post-acquisition.

• Gross margin improvements anticipated by internalizing chip production.

• Revenue synergies expected from enhanced technology differentiation and expanded offerings.