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

PHOTOS: Jazz at the Lake swings into its 17th year

The annual music festival ran over three days this past weekend

Town of Sylvan Lake looking at lake usage in new survey

The Town is in talks to contract part of the lake, but has to have a plan for water usage first

Over 1,000 barrel racers pouring into Ponoka next week for ABRA Finals

The Alberta Barrel Racing Association Finals will be held at the Calnash Ag Event Centre Aug. 19-25

It’s our lake too, eh?

The Sylvan Lake Watershed Society contributes a weekly column about many aspects of the lake

Disney Plus to launch in Canada in November

Analysts say latest streaming service may escalate cord cutting

Panel to review impacts of safe injection sites in Alberta

It will look at crime rates, social order and property values, and not harm reduction or housing

Five suspects arrested by Leduc RCMP with help of Wetaskiwin and Maskwacis

Leduc RCMP work with Maskwacis and Wetaskiwin RCMP to make arrests

Elections Canada to assess ‘partisan’ climate change rhetoric case by case

People’s Party of Canada Leader Maxime Bernier has said climate change is not an emergency nor caused by human

PHOTOS: 5th Annual Alix rodeo bucks the competition

Cowboys and cowgirls risked it all at the Alix Rodeo

Wetaskiwin RCMP arrest two in Camrose after report of suspicious persons

Fugitives try to flee on ATVS, one allegedly steals police car

Canada ‘disappointed’ terror suspect’s British citizenship revoked

Jack Letts, who was dubbed “Jihadi Jack” by the U.K. media, has been detained in a Kurdish prison for about two years

Most Read