Neil Bruce, president and CEO of SNC-Lavalin, listens to proceedings at the engineering company’s annual shareholders meeting in Montreal on Thursday, May 2, 2019. Executives at SNC-Lavalin Group Inc. continue to ponder a Plan B that could see the company break up ahead of a potential criminal conviction. THE CANADIAN PRESS/Paul Chiasson

SNC-Lavalin execs ponder company break-up at private shareholder luncheon

“Plan B” — what Montreal-based SNC might have to do if it can’t convince the government to grant a so-called remediation agreement

Executives at SNC-Lavalin Group Inc. continue to ponder a Plan B that could see the company break up ahead of a potential criminal conviction.

David Taylor of Toronto-based Taylor Asset Management, a shareholder of SNC-Lavalin, said the embattled engineering and construction firm’s CEO and chief financial officer discussed spinning off assets — which could include U.K.-based WS Atkins — at a private luncheon hosted by TD Securities in Toronto.

“They mentioned spinning off,” Taylor said in an interview, referring to chief executive Neil Bruce and chief financial officer Sylvain Girard.

READ MORE: SNC-Lavalin to step back from 15 countries, swear off fixed-price bids in mining

“They’ve got great assets within that are being punished and their good assets aren’t being valued properly. So they sort of hypothetically talked about crystallizing that value, and the only way you can really do that is to sell,” Taylor said.

The sitdown last Friday, first reported by the Globe and Mail, came a day after the company announced plans to wind down its operations in 15 countries and reported a $17-million loss in its latest quarter, precipitating a stock drop to new 10-year lows over the past few days.

The discussion floated an alternative to a possible plan that SNC-Lavalin laid out for federal prosecutors last fall where the company would split in two, move its offices to the United States within a year and eventually eliminate its Canadian workforce if it didn’t get a deal to avoid criminal prosecution.

Confidential documents, part of a PowerPoint presentation obtained by The Canadian Press in March, described something called “Plan B” — what Montreal-based SNC might have to do if it can’t convince the government to grant a so-called remediation agreement to avoid criminal proceedings in a fraud and corruption case related to projects in Libya.

SNC-Lavalin said in an email that it “continues to evaluate all possible scenarios to create maximum value for company shareholders.”

“We have publicly made it clear for several months that the company has a fiduciary obligation to its shareholders and employees to have a Plan B in place, retaining the services of external legal and financial advisers to help develop different scenarios for consideration,” the company stated.

“That said, no decision has yet been made, so it is premature to comment further on the subject.”

READ MORE:Few SNC-Lavalin rivals have been granted DPAs, contrary to CEO’s claims

SNC-Lavalin bought British engineering giant WS Atkins in 2017, which now has more than 10,000 employees in Britain.

SNC hopes to sell the bulk of its 16.77 per cent stake in Highway 407 to the OMERS pension plan, with a deal expected to close before the end of June.

Companies in this story: (TSX:SNC)

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Alberta RCMP offers tips for water safety this summer

Since 2016, 57 people have drowned in Alberta

‘Alberta Long Ears’ in Stettler Aug. 10th-11th.

Established in 1989, the Alberta Donkey & Mule Club is an offshoot of the national organization

Communities in Bloom judges check out Stettler’s finest features

National and International results will be announced in Yarmouth, Nova Scotia in September

Buccaneers pillage Irish 36-0

Central Alberta bounces back after off week against Wolfpack

Alberta Prairie Railways marks 30 unforgettable in the biz

Tickets purchased this year go to a special ‘luxury’ train ride for 30 guests

VIDEO: Calgary, Flames agree to terms on new NHL arena

The proposed 19,000-seat facility would replace the Saddledome at an estimated cost of $550 million

VIDEO: Missing teens named as suspects in three northern B.C. killings

Kam McLeod and Bryer Schmegelsky are wanted in the deaths of Lucas Fowler, Chynna Deese, unknown man

Alberta ahead of average tornado count at 17 so far this year

The province’s average over the past 30 years has been 12 tornadoes per year

The Beaverton’s sharp satire thrives in polarized political climate

Canadian TV series’ third season to air Tuesday on CTV after “The Amazing Race Canada”

VIDEO: Bystander training gains traction as tool to prevent sexual harassment, violence

Julia Gartley was sexually assaulted after an event, and no one stepped in to help

Sexual assaults, extortion on the rise even as crime rates stay low: Stats Canada

Rates of police-reported sexual assault rose for the fourth year in a row

A year later, ceremony commemorates victims of the Danforth shooting

It’s the one-year anniversary of when a man opened fire along the bustling street before shooting and killing himself

Ottawa fights planned class action against RCMP for bullying, intimidation

The current case is more general, applying to employees, including men, who worked for the RCMP

Alberta judge denies B.C.’s bid to block ‘Turn Off the Taps’ bill

He said the proper venue for the disagreement is Federal Court

Most Read