Threats that engineering giant SNC-Lavalin Group Inc. would move its head office to London from Quebec were a key part of extensive efforts by the Trudeau government to persuade former justice minister Jody Wilson-Raybould to intervene in the corruption case against the company, she testified on Wednesday.
Ms. Wilson-Raybould said during her testimony that Prime Minister Justin Trudeau and top civil servant Michael Wernick told her SNC-Lavalin would move its headquarters out of Montreal, and that there would be many jobs lost, unless it could negotiate an out-of-court settlement.
She quoted Mr. Wernick as telling her last September that the company “will likely be moving to London” if the case goes to trial.
The warning was part of a sustained campaign by senior government officials to get Ms. Wilson-Raybould to find a solution to SNC-Lavalin’s legal troubles, short of going to trial, Ms. Wilson-Raybould told the justice and human rights committee in Ottawa.
SNC-Lavalin is facing fraud and corruption charges over allegations that it made illegal payments to win government contracts in Libya in the 2000s. It has been anxious to work out a remediation agreement with federal prosecutors that would allow it to avoid a criminal conviction and a possible 10-year ban on selling to the federal government.
Federal prosecutors ultimately refused, and Ms. Wilson-Raybould declined to intervene in the decision, citing her reluctance to interfere in the independence of prosecutors. On Wednesday, she described several attempts by government officials to convince her to change her mind about finding a solution to SNC-Lavalin’s legal jeopardy.
During a meeting with Mr. Wernick on Sept. 19 – held at the insistence of Prime Minister Justin Trudeau – Mr. Wernick told her that the company and its lawyer, Frank Iacobucci, were “going back and forth” with the Director of Public Prosecutions, she said. And, despite Ms. Wilson-Raybould’s assertion that it would be inappropriate for her to intervene, she said he told her the company wanted more information.
“Iacobucci is not a shrinking violet,” Ms. Wilson-Raybould quoted Mr. Wernick as saying, in a display of the pressure the company was putting on the government.
The threat of decamping to London is not far-fetched. The company has a new European base of operations there, where it employs 1,200 people. It has another 8,800 employees elsewhere in Britain. SNC-Lavalin chief executive officer Neil Bruce was there at the start of February to open the new headquarters. The company has roughly 9,000 employees in Canada.
He said the company had been planning a London office since it acquired British engineering firm WS Atkins PLC in a $3.6-billion deal in 2017. It had been known as Britain's top engineering consultancy and one of the world's leading design and project engineering businesses.
Mr. Bruce told The Globe and Mail in February he sees little negative impact on European projects from Brexit because they are locally run, suggesting the operations are stable and expected to grow.
However, he said he was worried about the company’s immediate future because of the legal uncertainty stemming from the corporate ethics scandal hanging over the business.