Canadian satellite operator Telesat Canada and its parent BCE Inc. have agreed to sell the satellite services company for $3.42 billion (Canadian - $2.8 billion U.S.) to a new acquisition company formed by Canada’s Public Sector Pension (PSP) Investment Board and Loral Space & Communications. The new company will operate out of Ottawa under the name Telesat.

As part of the deal, Loral SkyNet will contribute fixed satellite services and network service assets including employees to the expanded Telesat giving the new company a global footprint and creating the world’s fourth-largest satellite operator.

PSP Investments is a Canadian crown corporation established by the Parliament via the Public Sector Pension Investment Board Act with about $30 billion in assets under management, Telesat said. The company, along with other Canadian investors, will hold majority voting control of the new company and 70 percent of Telesat’s board will be Canadian residents.

Loral and PSP will hold 64 and 36 percent economic interest, respectively, in the new Telesat. The transaction, expected to close in mid-2007, remains subject to regulatory approvals.