Why SatixFy Communications Shares Are Shooting Higher?

SatixFy Communications Ltd SATX shares are trading higher by over 26% after it inked a deal with MDA Ltd. MDALF to sell its digital payload division, SatixFy Space Systems UK Ltd., for $40 million.

Apart from the divestiture deal, the transaction includes $20 million in advanced payments under new commercial agreements, comprising the previous advanced payment of $10 million made in June to be applied to future orders of space-grade chips.

The transaction is expected to occur in Q4 FY23, subject to customary closing conditions.

"Today's announcement is an integral part of that strategy and brings SatixFy's cutting-edge space chipsets into MDA's digital payloads, representing a strong step forward in the commercialization of our technology. It demonstrates our market leadership in providing space-grade chips technologies for next-generation satellites and positions SatixFy as a leading innovator in the satellite communications industry and strengthens our competitive positioning. Furthermore, we expect that this transaction will increase our chipset sale into satellite digital payloads and will lead to increased collaboration between MDA and SatixFy in new areas. MDA has been a steadfast SatixFy customer, and we are thrilled to fortify this relationship further. In addition, we will continue to expand our ground terminals and chipset offering to the satellite communication markets," said Nir Barkan, Acting CEO of SatixFy.

Price Action: SATX shares are trading up 23.9% at $0.5925 on the last check Thursday.