The head office of SNC Lavalin are seen Thursday, February 19, 2015 in Montreal. (Ryan Remiorz/The Canadian Press)

Standard & Poor’s downgrades SNC-Lavalin, citing charges and diplomatic feud

Agency also highlighted the prospect of a ban of up to 10 years on contracts with the Canadian government

Debt rating agency Standard & Poor’s has downgraded SNC-Lavalin Group Inc., citing problems at a Chilean mining project, damaged business relations with Saudi Arabia and criminal charges against the beleaguered engineering giant.

The agency says a pair of slashed profit forecasts from SNC-Lavalin in the past three weeks — which first halved the per-share earnings target and then cut it again by more than 40 per cent — will make for a higher debt ratio.

The downgrade to BBB- from BBB notes the Montreal-based company has halted all bidding on future mining projects following a dispute with Chile’s state-owned copper mining company Codelco, now entering arbitration.

Standard & Poor’s says SNC-Lavalin’s growth prospects for oil and gas have “deteriorated” as the diplomatic feud continues between Canada and Saudi Arabia.

READ MORE: Ethics watchdog probes alleged PMO interference in SNC-Lavalin case

READ MORE: Opposition parties push for emergency meeting on SNC-Lavalin case

The agency also highlighted the prospect of a ban of up to 10 years on contracts with the federal government in Canada.

The ban is one possible outcome that could flow from a conviction on fraud and corruption charges stemming from alleged dealings with the Libyan regime under Moammar Gadhafi between 2001 and 2011.

The downgrade came after the federal ethics commissioner launched an investigation into allegations the Prime Minister’s Office put pressure on former attorney general Jody Wilson-Raybould to help the company avoid a criminal prosecution. Prime Minister Justin Trudeau has denied directing Wilson-Raybould on the matter.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Island fossil makes it to the top of the provincial list

Courtenay’s elasmosaur will be added to the official Provincial Symbols of British Columbia

B.C. BUDGET: Surplus $374 million after bailouts of BC Hydro, ICBC

Growth projected stronger in 2020, Finance Minister Carole James says

Victoria will be B.C.’s first city with GPS tracking, digital fare on transit buses

Two major technology uprades are underway on buses across the province

Victoria hotel trashes Channing Tatum in favour of B.C.’s Ryan Reynolds

Tatum’s picture left in recycling bin, replaced with photo of Ryan Reynolds

Jeep bursts into flames on highway near Nanoose Bay

Emergency crews responded to blaze at approximately 9:15 a.m. on Tuesday

VIDEO: 8 things you need to know about the 2019 B.C. budget

Surplus of $247 million with spending on children, affordability and infrastructure

RCMP ask for public’s help to determine cause of weekend fire

RCMP are investigating the cause of the South Island Concrete fire

Mount Doug thaw reveals abandoned Subaru, dog poo

Gate left unlocked in snow storm invites daredevil drivers

B.C. BUDGET: Income assistance raise still leaves many below poverty line

$50 per month increase included in funding for poverty and homelessness reduction

B.C. BUDGET: Indigenous communities promised billions from gambling

Extended family caregiver pay up 75 per cent to keep kids with relatives

B.C. BUDGET: New benefit increases family tax credits up to 96 per cent

BC Child Opportunity Benefit part of province’s efforts to reduce child poverty

B.C. BUDGET: Carbon tax boosts low-income credits, electric vehicle subsidies

Homeowners can get up to $14,000 for heating, insulation upgrades

Vancouver Island boys high school basketball bragging rights on the line

Oak Bay, Nanaimo, Ladysmith and Victoria host Island championships this weekend

Victoria to lose $6 million in funding for new Crystal Pool

No extension for March 31 gas tax grant deadline

Most Read