Pierre Fitzgibbon, Quebec’s Minister of Economy and Innovation, speaks at the Toronto Region Board of Trade on July 2, 2019.Megan Devlin/The Globe and Mail
Quebec’s Economy Minister would still like to see SNC-Lavalin Group Inc. offered a deferred prosecution agreement (DPA) on charges of fraud and bribery, adding Tuesday that the province would consider extending the firm financial support if asked.
Pierre Fitzgibbon said the question of a DPA is out of his control and he is not speaking to federal officials about it or lobbying for it.
“Of course I’d like a DPA to be made available to them. But time has passed. Frankly, I don’t count on it,” he said, speaking to the The Globe and Mail after addressing members of the Toronto Region Board of Trade. “We have to be realistic. A lot of the damage has been done.”
A DPA would allow SNC-Lavalin to avoid a lengthy court battle. If convicted, the Montreal-based engineering giant could be barred from working on federal contracts for the next 10 years.
“I look at SNC-Lavalin today, and I’m very happy about the progress they made,” Mr. Fitzgibbon said. “They have made some good strides in terms of cleaning up their ethical policy, and I think they should be commended for that"
Mr. Fitzgibbon said he hoped for a DPA given how important the company is to Quebec’s economy. “I think SNC-Lavalin, by and large, is a very profound, quality firm that should survive.”
SNC-Lavalin has been under intense pressure since October, 2018, when it announced it would not be invited by federal prosecutors to negotiate a deal to settle charges over its past business dealings in Libya. The charges relate to $48-million in alleged bribes to Libyan officials during the late Muammar Gaddafi’s regime for decisions that would benefit the Canadian firm, plus allegedly defrauding Libyan organizations of about $130-million. The alleged offences took place more than eight years ago and involve executives who have since left the company.
The company’s efforts to get a DPA became a political crisis for the Trudeau government. Accusations that officials in the Prime Minister’s Office had put pressure on then-attorney-general Jody Wilson-Raybould to order a deal for the company led to the resignation of the country’s highest-ranking bureaucrat and of Prime Minister Justin Trudeau’s principal secretary.
Ms. Wilson-Raybould’s successor, attorney-general David Lametti, has said a DPA is still a “legal possibility” for SNC-Lavalin. Mr. Lametti has the power to issue a directive to Canada’s director of public prosecutions to order a DPA negotiation. The director can also invite SNC into DPA talks at any point during the legal proceedings.
In May, a Quebec judge ruled there was enough evidence to move ahead with a trial. Last week, the company opted to have the trial decided by judge alone.
“We are focused on our business operations and on vigorously defending the charges through the court process,” SNC-Lavalin spokesperson Daniela Pizzuto said Tuesday.
Mr. Lametti’s spokesperson declined to say Tuesday whether he’s still considering a DPA, saying it would be inappropriate for him to comment on a case currently before the courts.
SNC-Lavalin has said a conviction and subsequent ban from working on federal contracts could push the company to move its headquarters out of the country, which could result in job loss.
In its spring budget, Quebec revealed a new $1-billion fund for helping strategically important businesses grow and keep their head offices in the province. At the time, Finance Minister Eric Girard said he could use it to protect the SNC-Lavalin’s Montreal executive suites.
Mr. Fitzgibbon said that SNC-Lavalin has not approached the province asking for any financial assistance, but if the beleaguered engineering company did ask for help, the province would evaluate the request.
However, the $1-billion is “meaningless, to some extent,” for a company of SNC-Lavalin’s size, Mr. Fitzgibbon said.
SNC-Lavalin’s new CEO Ian Edwards, who took over earlier this month, is tasked with reducing risk for the company by generating consistent revenue and cash flow
The company’s stocks have plummeted in the past six months, going from a high of $48.50 a share on Jan. 25 to a low of $23.70 a share on June 10. It closed yesterday at $26.31.
In a report Tuesday, analyst Frederic Bastien with Raymound James Ltd. said he believes “a bottom may finally be forming” on SNC-Lavalin’s stock, but said there’s “nothing pointing to a V-shaped recovery.”
“Incoming CEO Ian Edwards faces the daunting task of righting the SNC ship at a time when legal uncertainty prevails, political posturing still hurts the business, project execution risks remain high and employee morale is anything but," Mr. Bastien said.
Editor’s note: (July 2, 2019) An earlier version of this story incorrectly said Attorney-General David Lametti has the power to invite SNC into DPA talks at any point during legal proceedings. In fact, Mr. Lametti has the power to issue a directive to Canada’s director of public prosecutions to order a DPA negotiation.