CSG billionaire buys MDA Space stake valued at US$434 million

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The client was not given the opportunity to put restrictions on the content or review it prior to publication. by BDCCSG billionaire buys MDA Space stake valued at US$434 millionThe defence company sees potential to invest with MDA Space in manufacturing or assembly facilities in EuropeAuthor of the article:Michal Kubala and Andrea DudikThe purchase comes as CSG works on expanding its North American operations, with the 34-year-old Michal Strnad noting that it expects its U.S. business to “grow significantly.” Photo by Lina Selg/Bloomberg via Getty ImagesCzech arms tycoon Michal Strnad is making his biggest push yet into the space industry.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountThe defence company he controls, CSG NA, acquired a 9.5 per cent stake in MDA Space Ltd., accelerating its move into a sector the billionaire says is “one of the fastest-growing parts of defence.”The stake valued at US$434 million based on MDA Space’s closing share price on Monday makes CSG the Canadian space robotics and satellite-systems company’s largest shareholder.This advertisement has not loaded yet, but your article continues below.“If we want to be a global defence and technology group, we have to be in space,” Strnad said in an emailed message to Bloomberg. “If we do it right, in a few years it can become an important part of CSG’s revenues.”Breaking business news, incisive views, must-reads and market signals. Weekdays by 9 a.m.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Posthaste will soon be in your inbox.We encountered an issue signing you up. Please try againThe statement announcing the purchase didn’t provide the terms of the deal. MDA Space, which is listed in Toronto and New York, has a market value of $6.51 billion.The investment marks a significant push by CSG into an industry it has so far just dabbled in with small bets on early-stage space businesses via Tech Horizons, a fund it co-founded. The company has also set up a team focused on the sector, expecting the global space economy to nearly triple to about US$1.8 trillion by 2035.“Building everything from scratch would take too long,” Strnad said. “Even SpaceX and Rocket Lab needed more than a decade.”The purchase comes as CSG works on expanding its North American operations, with the 34-year-old tycoon noting that it expects its U.S. business to “grow significantly.”The company plans to increase capacity in large-calibre ammunition in the United States, establish and then expand production there of propulsion systems for drones and missiles, and seek a larger role in the American army’s modernization programs.This advertisement has not loaded yet, but your article continues below.“We don’t want to be in America only as a supplier,” Strnad said. “We want to manufacture there, employ people there and become a bigger part of the U.S. defence industrial base.”CSG also sees potential to invest with MDA Space in manufacturing or assembly facilities in Europe, teaming up on acquisitions and supporting the Canadian company’s international expansion.“A partnership to develop more international presence would be mutually beneficial,” Jefferies said of the deal, noting that “MDA remains heavily focused on the Canadian market.”For CSG, ammunition remains its core business for now, and Strnad expects the company to take a “big step forward” in 2027 toward controlling more of that supply chain. Projects include TNT production in Greece and production of nitrocellulose, a key ammunition input, and nitroglycerin, both in Germany, he said.CSG, which sold shares in January in the largest initial public offering for a pure play defence firm, is also working on “smaller” acquisitions involving components for large-calibre ammunition, he said without elaborating.The foray into new businesses also comes as CSG adds capacity to meet rising European demand for weapons and ammunition, with Strnad saying the increase in military spending will outlast the current rearmament push.“What I think is sometimes underestimated is how long this cycle is,” he said. “European countries have committed to higher defence spending for many years, not for one budget.”We apologize, but this video has failed to load.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. 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