OTTAWA
Telesat Corp. is evaluating a range of alternatives as a US$1.71-billion debt repayment deadline approaches on Dec. 6.
Chief executive Dan Goldberg told investors on Thursday that advisers are continuing to seek good-faith engagement with the company's creditors and are looking at other paths.
"Our advisers continue to seek good-faith engagement with the Telesat geo debt holders, and we're evaluating other alternatives as well, with the goal of reaching an outcome that's fair to all stakeholders," Goldberg said on a conference call to discuss third-quarter results.
He declined to provide specifics, saying the company is "pretty constrained in terms of what we can say at this time."
The debt was issued by a subsidiary called Telesat Canada and is tied to the company's fleet of geostationary satellites, an older and declining business division. Another US$438 million of debt matures in 2027.
The Globe and Mail reported that lenders including Silver Point Capital, GoldenTree Asset Management and Sound Point Capital Management presented Telesat with a recapitalization proposal on Oct. 14. That plan involves a $1.7-billion equity-rights offering and a $1.5-billion loan.
Telesat reported a net loss of $157.2 million for the three months ended Sept. 30, as revenue declined to $80.6 million from $101.1 million a year earlier.
The company attributed the revenue decline to a broadcast contract not being renewed, a broadcast customer reducing its capacity, reduced service to a North American broadband customer and the removal of certain geostationary satellites from service.
Telesat operates communication satellites that provide connectivity in remote areas to enterprise customers such as governments, telecoms and the airline and maritime industries.
The Ottawa-based company is building a constellation of low-Earth-orbit satellites called Lightspeed. The network has received significant federal support, including $2.54 billion in loans finalized by Ottawa and Quebec in 2024.
Prime Minister Mark Carney said in September that Canada will "diversify away from" SpaceX's Starlink service, "no question," as part of a wider push to cut strategic dependence on a single foreign supplier.
Federal support for Lightspeed already runs into the billions. Telesat now has more than $5 billion in federal loans and contracts behind it.
In August, Telesat announced a $2.3-billion contract to deliver Arctic connectivity to the Canadian Armed Forces. The company was also promoted in the Canada Investment Summit prospectus circulated to global funds last month.
SpaceX still sits at the centre of the launch plan. Telesat booked Falcon 9 flights to launch Lightspeed satellites, including the extra Arctic satellites in the military deal, so Canada's Starlink rival still needs Elon Musk's rockets to reach orbit.
Lightspeed is not expected to reach full global commercial service until around early 2028.
This story was written by the e2gold.ca newsroom from reporting by The Globe and Mail and iPhone in Canada. Quotes are checked word for word against that reporting.