Story
MDA Space Stock Declines on $712 Million Share Offering to Fund Acquisition
Summary
Shares of MDA Space Ltd. fell after the company announced a $712 million stock offering to help finance its planned acquisition of a majority stake in French satellite services firm Collecte Localisation Satellites (CLS).
MDA Space Ltd. (NYSE:MDA) shares fell 5% in after-hours trading Wednesday following the announcement of a public offering of 20 million common shares at $35.60 per share, for total gross proceeds of approximately $712 million. The offering is being co-led by underwriters BMO Capital Markets and RBC Capital Markets.
The company intends to use the net proceeds to fund a portion of its acquisition of an approximately 70% stake in Collecte Localisation Satellites (CLS). The cash transaction for the French satellite services provider is valued at approximately €567 million (about $920 million). The French space agency, CNES, is expected to retain the remaining 30% interest in CLS.
The acquisition is a strategic move for MDA Space, which expects the deal to double its recurring revenue stream and be accretive to adjusted earnings within the first year. CLS, which serves over 14,000 customers in about 150 countries, is projected to generate approximately €286 million (about $465 million) in revenue in 2026.
AdThe share offering is expected to close on or about July 14, 2026, subject to customary listing approvals from the NYSE and TSX. The acquisition of CLS is anticipated to close by the end of 2026 or early 2027, pending regulatory approvals. The company stated that the closing of the share offering is not conditional on the completion of the acquisition.