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

With sport, it’s best to start them young

When facing off on the court as teenagers, some players recall starting their career in elementary

Agassiz churches to come together for night of worship

The joint worship night is an attempt to revive an old event in the community

New Chilliwack YMCA was ‘worth the wait’ say visitors

Family Day will mark officially opening for new building, after sneak peek tours on Saturday

More people in Chiliwack coming in to shelters to get out of the cold

Ruth and Naomi’s went over-capacity this week to accommodate shelter guests coming in from the cold

Chilliwack Chiefs visit Kent Elementary

Grade 6 students got a chance to visit with, and play hockey against, some local hockey celebrities

VIDEO: Wheelchairs teach Agassiz students acceptance through sport

Teacher Donna Gallamore brought wheelchairs to the Kent Elementary for learning and fun

B.C. VIEWS: Power politics wins over rational energy policy

B.C Hydro continues to face interference on rates

PR firm suspends contract with former B.C. premier amid groping accusation

Edelman says in a statement that Campbell has served as a special adviser to the firm since last July

Vancouver crash leaves driver dead, 2 in hospital

Police are investigating what happened in 2-vehicle crash

James says B.C. budget puts priorities on NDP’s poverty, environment plans

She said she expected the government’s poverty reduction and climate change strategies to be priorities in the budget

Vancouver Giants blank Rockets

Langley-based G-men take over top spot in the west

PHOTOS: Day 1 of the 2019 Canada Winter Games in Red Deer

Games kicked off in Red Deer this week

Ammonia leak shuts down curling club in Nelson

It’s not yet clear when the leak was detected

Pavelski’s 31st goal helps Sharks top Canucks 3-2

Vancouver one point out of second NHL wild-card spot

Most Read