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

RCMP release sketch of Radley Beach assault suspect

The RCMP released on Oct. 22 a sketch of a man believed… Continue reading

Power outages affect almost 1,300 on Southside

Almost 1,300 BC Hydro customers on the Southside have been without power… Continue reading

Skeena-Bulkley Valley once again goes NDP

Smithers mayor Taylor Bachrach set to follow in Nathan Cullen’s footsteps

Trudeau has won the most seats — but not a majority. What happens next?

Trudeau will have to deal with some of the implications of Monday’s result

LIVE MAP: Results in Canada’s 2019 federal election

Polls are now closed across the country

Scheer says Canada more divided than ever, as NDP and Bloc hold cards close

While Liberals were shut out of two key prairie provinces, they took two-thirds of the seats in Ontario

Horvat’s hat trick lifts Canucks to 5-2 win over Red Wings

First career three-goal game for Vancouver captain

Saanich Gulf-Islands’s Elizabeth May coy about leadership plans

The federal Green party leader talks possibility of running as MP without being leader

Estheticians can’t be forced to wax male genitals, B.C. tribunal rules

Langley transgender woman Jessica Yaniv was ordered to pay three salon owners $2,000 each

Two youth arrested in UBC carjacking at gunpoint, after being spotted in stolen Kia

‘A great deal of credit is due the alert person who called us,’ said North Vancouver Sgt. Peter DeVries

People’s Party of Canada’s anti-immigration views ‘didn’t resonate’ with voters: prof

Party was formed on anti-immigration, climate denying views in 2018

Investor alert: ‘Split games’ pyramid scheme circulating in B.C.

British Columbia Securities Commission issues warning about scheme selling virtual shares

Federal NDP may support B.C. with major projects, Carole James says

SkyTrain Surrey extension, Massey Tunnel need Ottawa’s help

‘Issue-by-issue parliament’: Expert says Liberals need to placate NDP to be effective

Scandals, social issues, racism defined 2019 federal election, SFU prof says

Most Read