Business Marketing & News From Canada

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Month: January 2019

Hydro One to pay American energy company $103M US after failed merger plan

Hydro One to pay American energy company $103M US after failed merger plan


Hydro One and Avista Corp. say they have agreed to cancel their merger after regulators in Washington state and Idaho shot down the deal. 

The energy companies say that after weighing their chances of  getting those decisions reversed, both their boards of directors decided it was best to call off the plan.

They say under the terms of the merger agreement, Hydro One must now pay Avista US $103 million in termination fees.

Earlier this month, the Washington Utilities and Transportation Commission denied a request from both companies to  reconsider its rejection of the Ontario utility’s planned takeover of the American company.

Ontario electricity customers won’t foot bill, minister says

The request was issued after regulators found that the $6.7-billion planned merger would not sufficiently safeguard Avista customers from the whims of the Ontario government, which is Hydro One’s largest shareholder.

The regulator has pointed to Premier Doug Ford’s efforts to force former Hydro One CEO Mayo Schmidt to retire —which was followed by the resignation of the utility’s entire board — as a sign that the province was willing to put political interests above those of shareholders.

The Idaho Public Utilities Commission also denied the proposed takeover, finding that the companies had failed to demonstrate that the transaction met the public interest.

The merger required approvals from state regulatory commissions in Washington, Idaho, Oregon, Montana and Alaska to go through, but only the latter two have approved it. Oregon’s public utility commission opted last week to put its decision on hold.

Ontario Energy Minister Greg Rickford said the Progressive Conservative government accepts the decision made by the two utilities, and will continue to focus on bringing down hydro rates for Ontarians.

“Any costs incurred as a result of today’s decision will not be paid by Ontario electricity customers,” Rickford said in a
statement.  



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French minister announces Ghosn resignation from Renault

French minister announces Ghosn resignation from Renault


France’s finance minister says that Carlos Ghosn, who is fighting breach of trust and other charges in Japan, has resigned as head of Renault.

Ghosn has been detained for more than two months in Japan.

French Finance Minister Bruno Le Maire said at the World Economic Forum in Davos on Thursday that Ghosn formally handed in his resignation to Renault’s temporary leadership on Wednesday evening.

The board of French carmaker Renault SA is expected to name Jean-Dominique Senard of Michelin as chairman, and Renault executive Thierry Bolloré as CEO. 

Japan’s prosecutors, meanwhile, are defending Ghosn’s detention more than two months after he was arrested.

Shin Kukimoto, deputy chief prosecutor, told reporters Thursday the authorities want Ghosn in custody because of fears he might tamper with evidence.

Kukimoto also said Japan lacks a system for electronic monitoring of suspects released on bail. Ghosn offered to wear such a monitoring device in his latest request to be released. The Tokyo District Court has twice rejected his formal requests to be allowed out of the Tokyo Detention Center on bail.

Ghosn says he is innocent of any wrongdoing. He has been charged with falsifying financial statements and breach of trust.



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What Venezuelan turmoil could mean for Canada's oilpatch

What Venezuelan turmoil could mean for Canada’s oilpatch


More turbulence in Venezuela — including the threat of United States sanctions on its crude oil exports — has Canada’s oilpatch watching carefully for how the impact will ripple across the industry. 

Analysts say sanctions, or a further drop in Venezuelan oil output, could leave American refiners on the hunt for heavy crude from elsewhere, providing a potential price lift for Canadian producers.

But with limited ability to get more oil to the Gulf Coast, some believe the Canadian sector won’t be able to seize the additional market share it otherwise might.

Longer term, if Venezuela changes political regimes, the upheaval could see the South American country’s oil production soar once again — and change the outlook for global prices.

“Any more reduction in Venezuela crude could have an impact on the price of heavy crude for Canadian producers,” said Kevin Birn, an oilsands analyst with IHS Markit in Calgary. 

“In terms of our ability to maximize the benefit, we are constrained by our own infrastructure.”

Venezuela’s political and economic outlook is unclear as opposition leader Juan Guaido and interim president Nicolas Maduro struggle for control of the country.

Traditionally, Canada and Venezuela produce heavy oil that compete for space in the U.S. market. However, Venezuela crude production has fallen dramatically in recent years amid economic and political strife.

“There’s been a developing opportunity for Canadian crude, in particular going into the U.S. Gulf Coast refineries,” said Allan Fogwill, president of the Canadian Energy Research Institute.

“They were getting most of their heavy crude from Venezuela and Mexico — and a little bit from Canada. Now, with the concerns in Venezuela, that means those refineries are looking north to Canadian producers.”

Fogwill said limited pipeline capacity and rising demand for Canadian crude at those refineries is one reason why rail shipments of oil to the United States have been on the rise.

Maduro attends a rally in support of his government and to commemorate the 61st anniversary of the end of the dictatorship of Marcos Perez Jimenez in Caracas on Thursday. (Miraflores Palace/Handout/Reuters)

Last fall, Canadian shipping constraints to the U.S. led to a backlog of oil and steep discounts on Alberta crude. Prices increased significantly when the province imposed mandatory crude production cuts for 2019.

The heavy blend of oil from Alberta’s oilsands known as Western Canada Select was trading at $43.47 US a barrel on Thursday, up $1.36 US on anticipation that any decline in Venezuelan crude would result in more demand for WCS.

Rory Johnston, a commodity economist at Scotiabank, said the Canadian heavy crude price could further improve depending on whether the U.S. moves forward with sanctions and what happens with Venezuelan production.

“But I think at this stage it’s fairly unambiguously bullish for oil prices in the short term,” he said.

Robert Fitzmartyn, head of energy institutional research at GMP FirstEnergy, said he’ll be watching to see how any related improvement in crude prices filters into the market and Canadian energy stocks.

“The stock market probably responds mildly,” Fitzmartyn said.

Longer term, however, there are even more questions.

If there is regime change in Venezuela, oil production could ramp up to more traditional levels and that might come to weigh on oil prices, Johnston said.

“What that likely would mean is actually a slightly more bearish outlook longer term,” he said.

“Production has been declining so rapidly there [in Venezuela] that really, at this stage, virtually any alternative governance is likely to be better at managing that production.” 

Fogwill said that if Venezuelan production returns to traditional levels, it will have an impact on world prices, too.

“If Venezuela came roaring back … that could undermine the high price for oil.” 



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Premier Rachel Notley addresses Edmonton Chamber of Commerce

Premier Rachel Notley addresses Edmonton Chamber of Commerce

Political watchers will be measuring the partisan temperature of Premier Rachel Notley’s speech to the Edmonton Chamber of Commerce today.

Notley’s address — part of the chamber’s series of lunchtime events with the leaders of the provincial political parties —is scheduled to begin at 12:30 p.m.

CBC will live stream Notley’s speech here.

Liberal leader David Khan, United Conservative Party leader Jason Kenney and Alberta Party leader Stephen Mandel have already made their appearances in the chamber’s series.

As premier, Notley determines when Albertans will go to the polls this spring. She has said she plans to honour Alberta’s fixed election period legislation where the vote must be held between March 1 and May 30, 2019.

Notley has held press conferences over the past month which critics claim were free of real news and instead were opportunities to talk up her government’s record.

Last week, Notley took a partisan swing at Kenney, her main opponent, when she alleged he intended to introduce tolls on Alberta highways.

The UCP fired back by saying Kenney’s user-fee idea would only apply to new infrastructure required for industry.

As for Kenney, the UCP leader launched a four-day tour of northern Alberta with events in Slave Lake on Wednesday. Kenney’s trip will include stops in Grande Prairie, Fairview, La Crete, Peace River and High Level.

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Montreal real estate developer Tony Magi dead after NDG shooting

Montreal real estate developer Tony Magi dead after NDG shooting

A man in his 50s is dead after he was found shot in the upper body in Montreal’s Notre-Dame-de-Grâce district this morning.

Multiple sources have confirmed to Radio-Canada the dead man is Tony Magi, a businessman with known ties to the Montreal Mafia.

Police were called to a garage located at 6125 Saint-Jacques Street near Beaconsfield Avenue around 11:15 a.m.

Saint-Jacques is closed between Hingston Avenue and Grand Boulevard as police investigate.

Police have cordoned off St-Jacques Street between Hingston Avenue and Grand Boulevard as the investigation continues. (Simon-Marc Charron/Radio-Canada)

This is not the first time an attempt has been made on Magi’s life. 

In 2008, his SUV was left riddled with bullets in a shooting.

In 2011, his vehicle was again shot at. His wife, who was inside the vehicle at the time of the shooting, was unharmed in that incident.

In 2013, a man with a gun was spotted near his NDG home.

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Scout rolls out: Amazon tests delivery robots near Seattle

Scout rolls out: Amazon tests delivery robots near Seattle

Amazon is bringing delivery robots to the streets of a Seattle suburb.

The online shopping giant says it started to test self-driving robots in Snohomish County, Wash., Wednesday that can bring Amazon packages to shoppers’ doorsteps.

The robots are light blue, about the size of a Labrador, have six wheels and the Amazon smile logo stamped on its side, according to Amazon photos and videos. Six of them will be roaming the sidewalks of a Snohomish County neighbourhood Monday through Friday during daylight hours.

They move roughly “at a walking pace,” according to a statement from the company.

Amazon said a worker will accompany the robots at first, but it didn’t provide additional details of how the service would work. The company did not respond to questions from the Associated Press about the test.

Several companies have been testing similar delivery robots on college campuses that deliver fast food or snacks to students.

Amazon said its robot, which it is calling Scout, can navigate around pets, pedestrians and “anything else in their path.”

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Ottawa pledges $40M for Nokia to conduct 5G research

Ottawa pledges $40M for Nokia to conduct 5G research

Ottawa will announce up to $40 million for Finnish telecom giant Nokia on Thursday to conduct research on 5G wireless technology in Canada.

The funding comes as the federal government is in the middle of a comprehensive national-security review of the potential involvement of Nokia’s Chinese rival, Huawei, in Canada’s eventual fifth generation mobile network.

Ottawa is also locked in a diplomatic dispute with Beijing following Canada’s Dec. 1 arrest of Huawei executive Meng Wanzhou at the request of the United States.

Huawei, Nokia and Sweden’s Ericsson are among the top contenders to help Canada’s telecom companies, including BCE and Telus, build the country’s 5G mobile networks.

Three of Canada’s partners in the Five Eyes intelligence-sharing group — the United States, Australia and New Zealand — have banned the use of Huawei products in 5G network development based on fears the company could spy on behalf of China.

Canada’s Innovation Minister Navdeep Bains, who along with Public Safety Minister Ralph Goodale is responsible for overseeing the 5G security review, has said the analysis is not just about Huawei and is designed to assess how best to protect Canadians.

Bains finalized the Nokia deal Thursday in Davos, Switzerland, where he’s participating in the World Economic Forum.

Canada’s ongoing scrutiny of Huawei has created concerns within the Chinese government. Lu Shaye, China’s envoy to Ottawa, warned Canada last week of possible repercussions if the government ultimately decides to bar Huawei from building the country’s 5G networks.

A Chinese Foreign Ministry spokesperson later tried to play down Lu’s remarks by saying the ambassador didn’t mean that China intended to interfere in Ottawa’s decision-making process. Hua Chunying also told journalists in Beijing on Monday that losses would be inevitable since Huawei is a leading supplier of 5G technology, according to a transcript on the Foreign Ministry’s website.

Later the same day, Bains and Goodale told reporters that Huawei isn’t the only company that can build 5G in Canada. When asked about options, Bains mentioned Ericsson as an example.

Few details are available about Canada’s 5G security review, but a well-placed source has said a decision is still months away.

The development of 5G — or fifth-generation — mobile networks will give users much faster connections and provide powerful data capacity to meet heavy demand from new applications, such as virtual reality, as people connect more devices to the internet.

The federal funding will back Nokia’s research work in Canada to help telecom networks meet the needs of 5G technology. The company is also developing cybersecurity tools to protect telecom networks.

The government is expected to sell the deal as a way to support more than 2,000 of Nokia’s jobs already in Canada and to create 237 new positions. Nokia Canada’s projects, valued at over $214 million, are based in Mississauga, Ont., and the Ottawa suburb of Kanata.

Ottawa will also invest up to $35.7 million towards a $92.7-million partnership between Siemens Canada engineering company, and Atlantic Canada utilities Nova Scotia Power and New Brunswick Power. The deal calls for Siemens Canada to conduct research and development on smart-grid technology for power systems in the provinces.

The government’s Siemens and Nokia commitments will be made through a federal program known as the strategic innovation fund.

The issue of whether Huawei is allowed to build the country’s 5G networks has connections to a diplomatic crisis over Canada’s recent arrest of Meng, the company’s chief financial officer and daughter of its founder.

Canadian police arrested Meng at Vancouver’s airport at the request of American authorities, who are seeking her extradition on fraud allegations.

Her arrest has angered Beijing, and the case is at the heart of tensions between Canada and China. The Chinese government says Meng has done nothing wrong and has demanded her release, warning Canada of severe consequences if it doesn’t free her.

After her arrest, China detained two Canadians. Michael Kovrig, a Canadian diplomat on leave, and Michael Spavor, an entrepreneur, were taken in on allegations of engaging in activities that have endangered China’s national security.

In recent weeks, China also sentenced another Canadian, Robert Lloyd Schellenberg, to death in a sudden retrial of his drug-smuggling case. He was originally handed a 15-year jail term in 2016, but the court gave him the death penalty after revisiting his case.

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Airbus, Bombardier warn of consequences for U.K. factories in case of no-deal Brexit

Airbus, Bombardier warn of consequences for U.K. factories in case of no-deal Brexit

The CEO of European aerospace giant Airbus has warned it could move its British operations elsewhere if the United Kingdom leaves the EU without a deal in a hard Brexit.

In a video on the plane maker’s website, Tom Enders said Britain’s aerospace sector “stands at the precipice” because of uncertainty over when and how the country will pull out of the European Union, as it voted to do more than two years ago.

Earlier this month, the British Parliament roundly rejected the deal that Prime Minister Theresa May negotiated with European lawmakers, leaving little time to come up with a new plan before the deadline to leave, with or without a deal, at the end of March.

The looming threat of a hard Brexit has created uncertainty for British companies, and Airbus — which has factories all over Europe, and even some in North America — says there will be a price to pay for that uncertainty.

“If there is a no-deal Brexit, we at Airbus will have to make potentially very harmful decisions for the U.K.,” Enders said.

Airbus employs 14,000 people in Britain, including 6,000 at its main wings factory at Broughton, Wales, and 3,000 in Filton, western England, where wings are designed and supported.

Watch Enders’s comments in the video below:

“Please don’t listen to the Brexiteers’ madness which asserts that, because we have huge plants here, we will not move and we will always be here. They are wrong,” Enders said.

“Aerospace is a long-term business and we could be forced to redirect future investments in the event of a no-deal Brexit. And make no mistake there are plenty of countries out there who would love to build the wings for Airbus aircraft.

“It is a disgrace that more than two years after the results of the 2016 referendum that businesses are still unable to plan properly for the future,” he said.

“We still have no idea what is really going on here.”

Canadian jet maker Bombardier, which has a significant presence in Belfast, said it is “imperative” that lawmakers find a deal to create as orderly an exit as possible.

Airbus employs 14,000 people in Britain, including this man who helps assemble wings for A320s and A330s at a facility in Broughton. Despite Brexiteers’ claims to the contrary, the company could and would pull of out of the U.K. in the event of a no-deal Brexit, CEO Tom Enders said. (Paul Thomas/Bloomberg)

“Bombardier has been advocating for an orderly Brexit,” a spokesperson for Bombardier told CBC News. “This continued uncertainty, and the real prospect of leaving the EU with no deal, does not help with business planning.

“It is imperative that Parliament finds a resolution that works for U.K. business,” the spokesperson said.

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