Satellite operator Telesat has given space tech firm MDA a CAD 2.1 billion (nearly Rs. 12,950 crore) contract to build 198 satellites for its low-earth orbit program.

The deal announced on Friday sparked a more than 45 percent surge in both Telesat’s Canadian and US shares, putting them on track for their best day ever. MDA, meanwhile, rose about 29 percent.

Telesat said it had earmarked $3.5 billion (nearly Rs. 29,020 crore) as capital expenditure for the Lightspeed project and that the MDA deal had helped it save $2 billion (nearly Rs. 16,580 crore).

The launches are scheduled to commence in mid-2026, with polar and global services scheduled to begin in late 2027.

By using MDA’s beam-forming array antennas and integrated regenerative processor, the redesigned Telesat Lightspeed network will achieve increased network efficiency and enhanced flexibility to focus and deliver capacity to users, the company said in a statement.

The technology would also allow each satellite to be slightly smaller than the ones Telesat was previously considering.

Telesat’s Lightspeed network is designed to serve the connectivity requirements of enterprise and government users, with highly secure, resilient, low-latency broadband connectivity anywhere in the world.

The company launched its first LEO 3 demonstration satellite aboard Rocket Lab’s Electron rocket in July.

Telesat earlier on Friday also reported second-quarter results. The company posted a profit of CAD 519.9 million (nearly Rs. 3,210 crore), compared with a year-ago loss of CAD 4.38 million (nearly Rs. 27 crore). Revenue fell 4 percent. 

© Thomson Reuters 2023