Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

Telesat CEO Dan Goldberg sits beside a model of a Ariane 5 rocket that launched the Anik F2 satellite in 2004, at the company's headquarters in downtown Ottawa, on Sept. 4, 2020.

Justin Tang/The Globe and Mail

Ottawa-based Telesat Canada is going public on the Nasdaq Stock Exchange as it looks to raise funds for a multibillion-dollar project to beam high-speed internet to remote areas from a constellation of 300 low-Earth orbit satellites.

The satellite company – which is owned by the Canadian pension fund Public Sector Pension Investment Board (PSP Investments) and Loral Space & Communications Inc. – is also considering listing on a Canadian stock exchange. Telesat opted to go public on the Nasdaq initially because that’s where Loral, a holding company that owns 62.7 per cent of the Ottawa-based satellite operator, currently trades, Telesat’s president and chief executive Dan Goldberg said.

The deal, announced Tuesday, will see Telesat Canada and Loral become subsidiaries of Telesat Corp., a new, publicly traded company. No new shares will be issued as part of the transaction. Telesat’s current shareholders will own all the equity in the new company in roughly the same proportions they do now.

Story continues below advertisement

“This creates a much more rational, coherent structure among our shareholders and gives Telesat just a whole lot more flexibility in terms of how we fund our growth plans,” Mr. Goldberg said in an interview.

Telesat will consider issuing new equity when the deal closes, which is expected to occur in the second or third quarter of 2021, subject to approval by Loral’s shareholders. Telesat is looking to raise capital to fund the construction and launch of its planned LEO constellation.

“Telesat’s been a very active participant in the debt markets. Our current business generates a meaningful amount of free cash flow,” Mr. Goldberg said. “But certainly it’s a multibillion-dollar initiative, and so the more paths that we have to different financing sources, the better.”

The Globe and Mail first reported in August that the transaction would be announced when PSP Investments and Loral reached an agreement about how Telesat would be governed after going public. The deal includes provisions that will ensure Telesat remains Canadian-controlled – an important consideration for a company operating in an industry that relies heavily on government support, Mr. Goldberg said.

Telesat has received $85-million in research and development funding from Ottawa and has secured an additional $600-million from the federal government to support the delivery of broadband over the next decade.

“Maintaining our Canadian identity is important,” Mr. Goldberg said. “The government of Canada probably doesn’t love to see strong Canadian companies move offshore.”

Telesat faces tough competition in the race to deliver high-speed broadband from space to hard-to-reach areas. Elon Musk’s Space Exploration Technologies Corp. (SpaceX) has launched more than 800 satellites and got the green light from Ottawa this month to start beaming broadband to Canadian customers. It plans to deploy a total of 12,000 satellites to provide global coverage.

Story continues below advertisement

Tech giant Amazon.com Inc. has its own 3,236-satellite constellation, called Project Kuiper, in the works, and British-based OneWeb recently emerged from bankruptcy proceedings with US$1-billion in fresh capital to resume its project.

Telesat’s planned LEO constellation is much smaller, but the company says the 300 satellites it’s planning to use are more advanced, so fewer of them are needed. The constellation drew top marks for efficiency in a 2018 study by researchers at the Massachusetts Institute of Technology.

However, Telesat is lagging behind SpaceX in terms of timing. The Ottawa-based operator has yet to announce a manufacturer for its new constellation. Mr. Goldberg said during an Oct. 29 earnings call that such an announcement would be made in the coming weeks.

Telesat’s former owner, BCE Inc., filed paperwork to take the satellite operator public in 2006, but opted instead to sell the company to Loral and PSP Investments for $3.25-billion. Telesat already provides connectivity – including voice, data and video services – to clients such as cruise ships, airlines, governments and telecom providers via its fleet of geostationary satellites roughly 36,000 kilometres above Earth.

Geostationary satellites follow an orbit that parallels the planet’s rotation, keeping them in a fixed position relative to the Earth. LEO satellites orbit the globe several times a day from about 1,000 kilometres above, allowing for faster internet connections by reducing the amount of lag time, referred to in the industry as latency.

Unlike SpaceX, which plans to beam broadband directly to consumers, Telesat is focused on the enterprise market. That includes providing what is referred to as “backhaul” connectivity to telecom providers, who will then distribute broadband to individual homes.

Story continues below advertisement

Loral also declared it will pay a special dividend of US$1.50 a share, for an aggregate dividend of US$46.4-million, on Dec. 17.

Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the author of this article:

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies