SNC-Lavalin CEO denies wrongdoing in Ottawa political crisis

(Reuters) - SNC-Lavalin’s chief executive said on Friday the Canadian construction company has done “nothing wrong” in the broadening political crisis facing the country’s prime minister.

The SNC-Lavalin Group Inc., headquarters seen in Montreal, Quebec, Canada, February 12, 2019. REUTERS/Christinne Muschi

Prime Minister Justin Trudeau’s office is under fire for allegedly pressuring his former justice minister to try to ensure that SNC avoid a corruption trial over charges of bribing Libyan officials.

The federal government had refused SNC’s request for an agreement that would have allowed it to avoid a trial.

“I want to categorically say that we have done nothing wrong as a company,” SNC Chief Executive Neil Bruce told analysts on a conference call following the release of quarterly results. “We have never asked for charges to be dropped.”

Montreal-based SNC has been seeking to avoid a corruption trial because the executives accused of wrongdoing have left the company, and it has overhauled ethics and compliance systems.

Bruce on Friday also said he would not “give up” on pursuing business interests in Saudi Arabia, despite strained relations between Ottawa and Riyadh. Relations between the two countries have been tense as Saudi Arabia froze new trade with Ottawa in August after Canada demanded the immediate release of jailed rights activists.

“We’re not going to take that and give up, and that was the reason why I was there twice last week,” Bruce said.

He said an SNC board committee has hired advisers to look at options to improve shareholder value. Plans to sell a portion of SNC’s 17 percent stake in the 407 toll highway in Canada this year is “progressing well,” he said.

SNC said fourth-quarter revenue at its engineering and construction business fell to C$2.49 billion from C$2.87 billion a year earlier.

The company wrote down C$1.2 billion ($910 million) in oil and gas assets, which resulted in a C$1.6 billion fourth-quarter loss.

SNC lowered its quarterly dividend by 18.7 Canadian cents per share to 10 Canadian cents, as it seeks to save C$131 million in cash annually.

It also reported a C$346 million loss related to a South American mining project, which analysts believe is Chilean state-run miner Codelco’s Chuquicamata copper mine.

SNC projected lower annual revenue from its metals and mining business, as it stops bidding on lump-sum projects going forward.

Excluding one-time items, the company reported a loss of C$1.62 per share. Analysts on average had expected C$1.19 per share, according to IBES data from Refinitiv.

Earlier on Friday, Canadian Finance Minister Bill Morneau said he wants to see a business like SNC Lavalin “continue to be successful.”

Reporting by John Benny in Bengaluru and Allison Lampert in Montreal; Additional reporting by Julie Gordon in Ottawa Editing by Sai Sachin Ravikumar