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SNC-Lavalin Group Inc. shares surged more than 11 per cent after the company took steps to reduce risks by moving away from construction and oil to focus on its engineering services business. The shares gained $2.52 to $25.31 in Tuesday trading on the Toronto Stock Exchange after dipping to an intraday low of $22.62. The gains came after the Montreal-based company signed a deal to sell its resources oil and gas business to Kentech Corporate Holdings Ltd. The business, which represents about 90 per cent of SNC’s resources segment revenues, includes a backlog of $745 million and about 7,100 employees. The transaction is expected to close in the second quarter, subject to regulatory approvals and customary closing conditions. SNC said the oil and gas business will be classified as an "asset held for sale" in its fourth quarter of 2020 and is expected to result in a fair value writedown in the range of $260 million to $295 million. At closing, the company said the transaction is expected to generate a gain on the sale in excess of the fair value writedown, after accounting for the elimination of a foreign exchange adjustment. A charge of $95 million on the […]
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