But he couldn’t find a deal that worked, so the company deployed $500-million last summer in one of the bigger share buybacks in Canadian market history. Stock of the company – with a market value of about $2-billion – has been stuck in neutral in the past year but has more than doubled in the past three. On three-, five- and 10-year scales, MDA has outpaced the benchmark S&P/TSX index.
We are joined at lunch by Anil Wirasekara, the long-time chief financial officer who took his post in 1996, one year after Mr. Friedmann became CEO. Speaking more like a chief marketer than a bean counter, Mr. Wirasekara says, “What people don’t realize is that we have a brand” – he emphasizes brand – “that we have developed over 40 years. It’s world-renowned.”
The company remains on the hunt for a new business. Annual sales from continuing operations are roughly $750-million, up almost two-thirds from 2008. “We need to pick the right market, the right area, and then something to build on.”
A dozen years ago, MDA propelled its move into property information by buying BC OnLine from the provincial government after a couple of years of trying to start something similar itself with its software savvy. MDA wants to replicate the move, buying a company, taking on a smart management team and existing customers. A Canadian company focused only on space can’t succeed, Mr. Friedmann insists, citing other once-strong domestic firms such as Spar Aerospace that struggled.
MDA had just 100 employees when he started, so he quickly become involved in all facets of the operation. “It was six months and then I was at a customer lunch, trying to find a tie somewhere in my closet.” Along the way, he says he worked solo through the equivalent of an MBA, reading and studying everything he could about business during his off-hours.
One big project that is faltering is MDA’s ambitious quest to service satellites currently in orbit, starting with refuelling. Last March, it clinched a $280-million deal with Intelsat SA of Luxembourg, the world’s top operator of fixed commercial satellites – and the broader plan was to sign on the U.S. military and government to underpin the project. But the idea stalled, as the U.S. government, through NASA, is mulling plans to co-ordinate its own servicing project. MDA is watching the situation unfold, and applying to participate in the U.S. government process.
“We’re trying to do something that hasn’t been done before, in a country [Canada]that is not at the forefront of space exploration,” Mr. Friedmann says. “So it’s tough. And we’re not going to do it unless it makes sense for our shareholders. It’s not something we have to do.”
Mr. Friedmann has always been inventive. When he was in high school he and a friend designed a monoski system – a weird niche where the two skis are bound together as one. “It went bankrupt,” Mr. Friedmann says. “That business venture, I didn’t have Anil as my partner, that was my problem. We had technical problems, and marketing problems. Now I am perfectly safe.”
In space, the company’s biggest-ever deal is set to be sealed. MDA is the lead on Canada’s next-generation satellite system called Radarsat Constellation. The crucial Phase D, worth roughly $500-million to build the system, is expected to get Ottawa’s go-ahead by the end of March.
MDA technology isn’t widely recognized by most people because it generally operates unseen, in the background. When MDA’s Radarsat satellites monitor Canada – the surveillance can spotlight down to a single metre – there isn’t any obvious MDA or Made in Canada stamp that people can see or cheer.
MDA remains involved in a dazzling array of applications, from space exploration (prototype instruments to search for minerals on the moon and discern details on the surface of Mars), to women’s health (an image-guided surgical robot that performs breast biopsies), to monitoring the Earth (in one recent contract, MDA was commissioned to track “lightning on a global scale” for Lockheed Martin and the U.S. government).