SNC-Lavalin Group Inc. probably isn’t leaving Canada anytime soon, according to its largest investor’s former second-in-command.
“I don’t think that there is a serious scenario” former Caisse de dépôt et placement du Québec deputy chief executive officer Michel Nadeau told BNN Bloomberg on Friday when asked about the possibility of SNC moving its headquarters out of Canada. “(SNC CEO) Neil Bruce is not willing to move back to London.”
“Five or six years ago SNC-Lavalin tried to set up an office in London with international supervision, but they changed their mind. Now, with the Caisse partnership, I think they want to remain in Montreal,” he added.
The Quebec-based construction giant at the centre of the current firestorm on Parliament Hill is facing fraud and corruption charges related to its dealings in Libya in the early 2000s. If found guilty, SNC could face a 10-year ban from winning contracts from the Canadian government.
The decision whether or not to prosecute SNC was at the heart of former attorney general Jody Wilson-Raybould’s explosive testimony this week, as she alleged that she received “veiled threats” from the Prime Minister's Office, the Privy Council Office, and Finance Minister Bill Morneau's office.
Nadeau reckons SNC-Lavalin, which pledged to keep its head office in Montreal for at least seven years as part of an agreement in 2017 when the Caisse backed the company's takeover of WS Atkins Plc, will find alternative ways to survive if it ends up being shut out from federal contracts as a result of the criminal case.
“I think that the management of the company would try to find alternatives, work try to with provinces, would try to work with private sector projects,” Nadeau said.
“I think it would be a difficult period, but I’m sure that the management of SNC-Lavalin is trying to see various alternatives.”
Nadeau, who said that a conviction could still be as much as three or four years away, added that government contracts only make up a fraction of SNC’s business.
“Don’t forget that Canadian operations represent less than one-third of the overall SNC-Lavalin revenue.”
Nadeau also wondered if SNC could use its partnership with Atkins to get around a potential ban.
“My question is: Would it be possible for SNC-Lavalin to get federal contracts through Atkins U.K.?” Nadeau said. “Because Atkins U.K. was not involved in the SNC-Lavalin bribery case during the last decade.”
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