Largest satellite company in Canada weighs global acquisitions after feds loosen restrictions

Source: Globe and Mail

Canada's largest satellite company is mulling global acquisitions after the federal government said it would loosen foreign ownership restrictions in the telecom sector.

“We would be very receptive to finding smaller satellite operators and seeking to consolidate them, gaining the competitive benefits that flow from having greater scale,” said Daniel Goldberg, president and chief executive officer of privately held Telesat Holdings Inc.

An initial public offering is now also an option, added Mr. Goldberg, who has been Telesat's CEO since September, 2006, shortly before it was sold by BCE Inc. for $3.42-billion to the Public Sector Pension Investment Board and Loral Space & Communications Inc.

Canada's satellite sector garners little attention from either Bay Street or average Canadians. But the government's overtures in the federal budget to eliminating foreign ownership restrictions, combined with satellite's growing role in supplying rural areas with Internet service, may drag it back into the limelight.

The government said it will start liberalizing ownership restrictions in the Canadian satellite sector before it does the same for the broader telecommunications industry. This is largely because the satellite sector is much less politically contentious: None of the companies involved cross over into media or broadcasting, where there are cultural and heritage concerns.

The new policy is nothing but positive for Telesat, which has been competing against foreign rivals that can operate in Canada without being subject to the same ownership restrictions.

© Globe and Mail