The timing was embarrassing. On March 11th Jim Prentice, Canada's industry minister, went to Cape Canaveral to boast of his country's prowess in the space industry. He watched the launch of a space shuttle carrying robotic fingers for the retractable arm attached to the International Space Station, just as the shareholders of MacDonald, Dettwiler and Associates (MDA), the Canadian firm which designs and builds the fingers, the arm and some highly sophisticated satellites, voted to sell these businesses to Alliant Techsystems, an American defence company.
The news has prompted much handwringing. That is partly because of the nature of the firm's business: its iconic Canadarm has been used by the shuttle since 1981, and some Canadians worry that foreign ownership of its satellites, which keep an eye on the Arctic and the coasts and were developed partly with public subsidy, would threaten national security.
More broadly, the sale plays on a growing fear that Canadian industry is being hollowed out and that many emblematic firms are being sold to foreigners. Such fears are hardly unique to Canada. But Canadians perennially fear becoming a branch office for their mighty neighbour to the south. In fact, a string of recent takeovers has mainly featured investors from further afield. Two mining giants, Falconbridge and Inco, were bought respectively by Xstrata, a Swiss firm, and Brazil's Vale, each for close to C$20 billion ($20 billion). Rio Tinto, an Anglo-Australian firm, took over Alcan, an aluminium producer, for twice that figure. Saudi investors joined with Americans to snap up Four Seasons and Fairmont, two posh hotel chains.
Less noticed was that Canadian firms gave almost as good as they got. Thomson, a media group, bought Reuters (for C$19 billion) while TD Bank bought Commerce Bancorp, an American bank, for C$8.5 billion. Canadian investors purchased 508 foreign firms last year, compared with 192 acquisitions made by foreigners in Canada, according to... [continues]
The news has prompted much handwringing. That is partly because of the nature of the firm's business: its iconic Canadarm has been used by the shuttle since 1981, and some Canadians worry that foreign ownership of its satellites, which keep an eye on the Arctic and the coasts and were developed partly with public subsidy, would threaten national security.
More broadly, the sale plays on a growing fear that Canadian industry is being hollowed out and that many emblematic firms are being sold to foreigners. Such fears are hardly unique to Canada. But Canadians perennially fear becoming a branch office for their mighty neighbour to the south. In fact, a string of recent takeovers has mainly featured investors from further afield. Two mining giants, Falconbridge and Inco, were bought respectively by Xstrata, a Swiss firm, and Brazil's Vale, each for close to C$20 billion ($20 billion). Rio Tinto, an Anglo-Australian firm, took over Alcan, an aluminium producer, for twice that figure. Saudi investors joined with Americans to snap up Four Seasons and Fairmont, two posh hotel chains.
Less noticed was that Canadian firms gave almost as good as they got. Thomson, a media group, bought Reuters (for C$19 billion) while TD Bank bought Commerce Bancorp, an American bank, for C$8.5 billion. Canadian investors purchased 508 foreign firms last year, compared with 192 acquisitions made by foreigners in Canada, according to... [continues]
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