SNC-Lavalin warned of U.S. move, slashing workforce if no plea deal, documents show
Quebec engineering firm warned it would move abroad within a year, cut workforce in Canada to 3,500
SNC-Lavalin warned federal prosecutors last fall about a possible plan to split the company in two, move its offices to the United States and eliminate its Canadian workforce if it didn't get a deal to avoid criminal prosecution, newly obtained documents show.
The documents, part of a PowerPoint presentation obtained by The Canadian Press, describe something called "Plan B" — what Montreal-based SNC might have to do if it can't convince the government to grant a so-called remediation agreement to avoid criminal proceedings in a fraud and corruption case related to projects in Libya.
Under that plan, SNC would move its Montreal headquarters and corporate offices in Ontario and Quebec to the U.S. within a year, cutting its workforce to just 3,500 from 8,717, before eventually winding up its Canadian operations.
"The government of Canada needs to weigh the public interest impact of the prosecution of SNC-Lavalin," the presentation reads.
"We must humbly ask whether the public interest is served to prosecute SNC-Lavalin, and to try to achieve a guilty verdict. Such a decision would effectively lead to the end of SNC-Lavalin as we know it today and has been for more than 100 years."
Of all the options for the future of the company, the plan in the presentation was the "most obvious" to follow and "well advanced" in terms of planning, say the documents, which the Privy Council Office confirmed receiving late last year.
The company's board and senior management were prepared to quickly bundle parts of the business that had no role in the Libya case into a new entity, putting the "trio of possibly convicted entities" into another organization that would operate "on a reduced business level in Canada or heading into eventual wind-up," they read.
SNC-Lavalin spokesman Nicolas Ryan confirmed the authenticity Thursday of what he called a "confidential document" that was submitted to the Public Prosecution Service of Canada to allow the director of public prosecutions to consider the company's request for an agreement.
"We have always been transparent with our various stakeholders about the importance of the public interest argument/case for Canada in having a globally competitive SNC-Lavalin as part of Canada, headquartered in Montreal," Ryan said in a statement.
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