Consortium led by SNC-Lavalin to build new Montreal bridge
OTTAWA (Reuters) - The Canadian government said on Wednesday that a consortium led by SNC-Lavalin will build a new multi-billion dollar bridge in the Montreal region.
The government, which said it expected the bridge would be in service by 2018, had previously estimated it would cost about C$5 billion ($4.07 billion) but it did not provide an updated estimate on Wednesday.
Preparatory work on the bridge, a public-private partnership described as one of the largest infrastructure projects in North America, is to set begin this summer and is expected to generate 30,000 jobs, the government said in a release.
Analysts said the contract is a boon for the Montreal-based engineering company which is facing federal fraud and corruption charges in a case connected to deals with Libya that is supposed to go to trial in July.
In a note to clients, Maxim Sytchev, managing director, head of research for Dundee Capital Markets, said the bridge contract is a "strong vote of confidence" that SNC can win federal contracts given investors' concerns that the government would balk at a company investigated by the RCMP.
"Today's announcement suggests that the debarment fears were overblown; please note that during our conversations with investors, the vast majority assumed that the Champlain bridge contract would go elsewhere," Sytchev wrote in a note.
In a statement, Diane Finley, Minister of Public Works and Government Services Canada said the winner was selected "through a rigorous open, fair and transparent procurement process."
(Reporting By Mike De Souza and Allison Lampert; Editing by Bernard Orr)
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