SGI to divest Atlantic Canada brokerage group

Saskatchewan Crown Corporations Minister Ken Cheveldayoff has announced the province’s Crown corporations are moving towards a “Saskatchewan First” investment policy, with the province’s Crown corporations divesting from certain out-of-province investments.Cheveldayoff told CanWest the policy would not affect SGI Canada’s out-of-province insurance subsidiaries in Alberta, Manitoba, Ontario and Prince Edward Island. He said SGI’s out-of-province insurance operations are safe because they support its operations inside the province of Saskatchewan.However, he also told CanWest that SGI’s holdings in the Cooke Group, insurance brokers in Atlantic Canada, are slated for divestment.The Saskatchewan government said it pursued its “Saskatchewan First” policy in light of the results of a KPMG study that showed many of the previous government’s investments have lost money.”We contracted KPMG to review Crown investments made outside Saskatchewan by previous governments,” Cheveldayoff said in a press release. “Over time there has been almost a half-billion dollars invested with a target return of 22%. Alarmingly, the actual overall rate of return on these investments to date was a negative 15%.”Over the past 16 years, Crown corporations SaskTel, SaskPower, SaskEnergy and SGI all made out-of-province investments.In total, KPMG reviewed 26 investments, including 16 active investments and 10 exited investments. The Crowns invested Cdn$465 million in these 26 investments, and the capital remaining in the active investment portfolio is approximately Cdn$300 million.Of the four Crowns, SaskTel has made the most investments outside Saskatchewan.