SNC-Lavalin Group Inc.\’s path into the good graces of investors is thru a highway: The 108-kilometre 407 toll road the company is seeking to divest from. That, and clarity within the company\’s technique to absolve itself from the fraud charges slapped on through the federal government regarding its Libyan business.
But the Montreal-based company\’s management didn’t limit a timeline for that 407 sale at its fourth-quarter earnings announcement, or reveal much about making headway around the fraud charges.
\”This year is our plan [to sell 407]-. It\’s a complicated process to extract full value from [the 407],” Robert Card, president of the engineering and construction giant reiterated at an investor call. “We\’ve more I’s to dot and T’s to cross therefore we will be back with you.”
I want to stress that with these charges there’s no change to our right and skill to bid or work on any public or private projects
Divesting its 16.77% stake within the 407 highway would bring some good news for SNC that saw its old wounds reopened through the federal government, which laid charges for fraud and corruption in February.
Mr. Card said the company will fight the charges \”vigorously,\” but the news had not damaged its relationship with clients or hampered its ability to secure future contracts.
\”In the meantime good quality to continuing our constructive and cooperative relationship using the authority,\” Mr. Card said. \”I wish to stress by using these charges there’s no change to our right and ability to bid or work on any private or public projects.\”
The stock had fallen nearly 11% from $44.31 because the start of the year, as investors concerned about reputational risks towards the company, and the latest earnings result saw the share plunge another 6.7% Thursday to finish the day at $36.97.
\”Certainly the stock is really a heck of a deal right now,\” Mr. Card said, and some analysts agree.