Telesat: Initial Thoughts on TL Lender Lawsuits
Mark Lightner, Esq. - Head of Special Situations Legal Research, CreditSights
Jessica Reiss, J.D. - Head of U.S. Loans Research, Covenant Review
Jory M. Eisenberg, CFA, FRM - Senior Analyst, Special Situations, CreditSights
Davis Hebert, CFA - Co-Head HY Research, Head of Telecom/Media, CreditSights
Savannah Buzzeo - Analyst, Telecom / Media, CreditSights
22 January 2026
- How the equity transfer allegations could reshape creditor negotiations and restructuring dynamics ahead.
- Why covenant breach claims matter for asset separation strategies and stakeholder positioning decisions.
- What fraudulent conveyance arguments under Canadian law mean for cross-border enforcement and remedies.
- Which legal theories lenders deployed across multiple jurisdictions to maximize negotiating leverage effectively.
- Where board liability exposure intersects with corporate governance and fiduciary duty breach allegations.
Executive Summary
On January 21, 2026, Telesat’s term loan lenders filed two lawsuits. One in New York state court, second in Ontario Superior Court.
Telesat faces a US$1.7bn debt maturity wall in December 2026. Refinancing prospects heavily dependent on attributing significant value to LEO business.
The plaintiff argues the LEO equity transfer violates the credit agreement. Lenders left with diminished asset pool backed by declining GEO business.
The transfer allegedly amounts to fraudulent conveyance under Canadian law. Directors and officers allegedly personally liable for the LEO transfer.
We are still evaluating what these cases mean for restructuring prospects. Initial impressions suggest it seems designed to spur negotiations.
Fill out the below form to view the full article:
Please note that we can only respond to valid business email addresses and the interview is already available to clients.
Recently Published
Research
AllCovenant-ReviewAutosUS CR Quarterly Q1SovereignsBasicLevFin-InsightsTelecommunicationsMay GMUSeptember GMUFinancialsCreditSights-ResearchUtilitiesCase StudiesUS LME in Focusshow-homeshow-initiation page-homeMunicipalsSLRsOctober GMUTMTAsset Management ResourcesPharmaceuticalsJune GMUAsia in Focus Preliminary 2027 OutlookEnergyResearchGaming/LeisureWebinar Related ResourceVMED WebinarIndustrialsPoliticsMediaUS Special Sits OutlookBankruptcy 4Q26ConsumerTariffsSpecial SituationsEuro Autos: Barbarians at the GatesCorporatePrivate CreditAerospace/DefenseU.S. Autos Expert PanelCovenantsBondsReal EstateEU Special Sits OutlookStrategyPost PetitionServicesJuly GMUESGChemicalsIranAsia in Focus 2H26ESG-HomeEmerging MarketsBanksEM OutlookOutlooks-HomeTransportationConstructionEMEA CR Quarterly Q2TechnologyInsuranceAsia in focus webinarUS CR Quarterly Q2ManufacturingEMEA CR Quarterly Q1Global Credit for ME Investors
Trivium: Outperform on Silgan/AIP Acquisition
Trivium: Outperform on Silgan/AIP Acquisition
Read More
US Bankruptcy: DIP Data Report Q3’26
US Bankruptcy: DIP Data Report Q3’26
Read More
U.S. Liability Management Transactions: Quarterly Update Through Q3 2026 and Primer
U.S. Liability Management Transactions: Quarterly Update Through Q3 2026 and Primer
Read More
US/EMEA Insight: Q&A with John Gally, Morgan Stanley’s Global co-head of Leveraged Finance