Prentice is right to reject MDA space deal

1 response

  1. Dan says:

    The right decision? The right decision?

    What a pathetic analysis.

    Let’s consider the legal implications. The ‘Investment Canada Act’ clearly states that the act considers the net benefit to Canada in terms of capital investment, economic gains and employment opportunities. Given ATK offered assurances it would keep employees in Canada (and RadarSat 2 can only be operated from Canada) not mention ATKs $1.3billion investment (almost equal to the market cap of MDA before the sale was announced for a division that is 1/3 of EBITDA and experiencing much slower growth than the Info. Products division) this clearly holds NO LEGAL GROUNDS for denial under the Investment Canada Act. NOTE: INVESTMENT CANADA ACT DOES NOT INCLUDE PROVISIONS TO DENY AN AQUISTION ON CONCERNS OF NATIONAL SECURITY IMPLICATIONS, PREVIOUS TAX CREDITS AND PUBLIC FUNDING OR NATIONAL PRIDE.

    Your argument is even more pathetic – implying that after losing resource companies such as Inco and Falconbridge that the gov’t had to step up and protect corporate Canada. Perhaps you didn’t realize that not only were those businesses in completely different industries but were acquired by a European and Brazilian company and there was arguably a much bigger loss for our economy than a dead space business. But hey, I’m sad that Canada doesn’t have a mega miner ala BHP, CVRD, etc. and have developed an inferiority complex because our economy is smaller than those of our nations so I suppose the way to deal with that is to force Canadian shareholders to hold on to a crap business line rather than receive a cash offer that pays 3-4x the value of the division and could be used to buy struggling competitors and build an even strong Canadian company to be proud of.

    LESSONS FROM THE AVRO ARROW? Are you trying to fill some sort of quota for references to iconic Canadian technology (if you maybe you could throw in John Diefenbaker would be the first to send Minister Prentice a message on his Blackberry while riding his Bombardier skidoo). Ya, destroying the technology and research for $0 because some sucker bought the line “no, no you don’t want to build a jet better than ours – we’re switching to ICBMs soley anyways” is the same as selling 1/3 of your EBITDA for nearly the same value as your company even though it is becoming even more difficult to secure the contracts you need to sustain the division.

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