RE:RE:RE:RE:Jury still negotiating verdict. Ron, I consider this a setback for SNC investors. It provides a prescident for bribery conviction for actions taken be SNC agents. This makes a conviction of the company easier for the same charge.
That does not mean conviction of SNC is predetermined. A settlement is still possible and likely in my opinion. Why punish all stakeholders for acts of few guilty individual parties. See the many, many examples I have posted re settlement for worse corporate charges. VW Canada will come next week.
If convicted in court SNC could face a 10 yr ban on Federal contracts.That is a maximum punishment. Unlikely outcome imo. Far lighter resolution is probable.
Keep in mind federal contracts are less of SNC business model now since no LSTK projects to be bid in future. That is the magority of previous contracts. Provincial contracts are available to bid (ie not banned from if convicted)
Unfortunately the situation became VERY polital last year. An objective viewer can see Canada is being particularly stringent with regard to criminally charging SNC. Completely out of step with our competitors. But poitics are unpredictable and emotional. Just ask Sheer. So, although a settlement is VERY sensible it may not be politically palatable at this time.
I look for a drop in price short term, this does not change the company outlook financially.
Recovery is ongoing. If they sell resources division soon that is positive catalyst. Earnings in Feb will be next solid indicator of turnaround progress.
Reasonably a conviction of bribery is bad for this company if only on reputational basis. I think and hope that will not happen.
This case decision is less impactful than a bad earnings report, but somewhat negative IMO.
Market will tell you Monday. I will continue to accumulate barring a negative earnings surpise which indicates further mismanagement.