Canadian engineering giant SNC-Lavalin now won’t face a hearing on a key set of corruption charges until at least 2018, in a deal reached with federal officials late last month. Actual trial likely won’t occur until a year or two later, a top company executive told analysts on March 3.
While the delay means the charges—linked to actions by long-departed executives—continue to hang over the firm, it also offers more time to reach a government settlement. Two cases involving alleged bribery and embezzlement in Libya over a decade—with the firm and an ex-executive as separate defendants—now will be combined.
SNC-Lavalin has been vocal in its drive to convince the Canadian government to adopt non-prosecution agreements that would allow the company to pay a fine without admitting guilt. Most other developed nations, including the U.S., use such pacts, the Montreal-based company has argued, noting its complete overhaul of management, and of ethics policies.
“Some form of deferred prosecution agreement should be implemented ... for all Canadian companies,” said Alain-Pierre Raynaud, SNC-Lavalin chief financial officer. “Any other Canadian company who ended up in the same position as us, is at a serious competitive disadvantage versus our U.S. and European peers.”
SNC-Lavalin, a major federal contractor in Canada, won a short-term reprieve in December that lets it compete for government work while it defends itself in court.
Analysts seemed optimistic as the firm announced fourth-quarter 2015 numbers. “Benefiting from the roll-off of over-budget projects and a heightened focus on execution and risk management, SNC delivered another quarter of encouraging results,” said Yuri Lynk, Canaccord Genuity construction sector analyst.