REGINA – The Saskatchewan government is selling the Crown corporation that handles land and personal property registries, but the Opposition NDP says the move breaks a promise.
The government introduced legislation Monday that will allow it to sell 60 per cent of Information Services Corp.
Don McMorris, minister responsible for ISC, said a sale is the best way for the company to grow beyond Saskatchewan.
“It has got a great product to put on display and hopefully sell throughout the world,” McMorris said.
“It has, again, serviced the people of Saskatchewan very well, but we realize that the growth potential here in Saskatchewan is not nearly as great as if we allow it to sell its products and services around the world.”
ISC was formed as a Crown corporation in 2000 and has about 300 employees, who are expected to keep their jobs.
It’s responsible for the administration of land titles, vital statistics, survey, personal property and corporate registries. However, vital statistics, including births, marriages and deaths, will be transferred to the government and are not part of the sale.
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McMorris said there have been success stories with such sales in the past, pointing to Potash Corp. of Saskatchewan (TSX:POT) and Cameco _ which both started as Crown corporations.
Of the 60 per cent of shares that will be for sale, five per cent can be bought by employees, 45 per cent by Saskatchewan citizens and 50 per cent by outside investors. No one person or group of investors will be allowed to buy more than 15 per cent of the shares sold.
The government said the shares are expected to raise between $90 and $120 million, which McMorris said will be used to build infrastructure, such as roads.
The legislation says the company’s head office must stay in Saskatchewan. The province will also keep 40 per cent of ISC.
“It was a discussion around balance,” said McMorris.
“Having the government in a position to benefit from the potential growth, which we think is there, but not hindering the possibility of sales because it is too much owned by government.”
The 40 per cent figure is not enshrined in the legislation, meaning more of the company could be sold down the road.
Although, McMorris said there is no immediate plan to change the amount.
“We want to see how the company runs and how successful this is into the future,” he said.
The Opposition NDP said Premier Brad Wall is on record in 2007 as saying he would not sell off the Crowns. New Democrat Cathy Sproule said the sale of ISC was not mentioned in the provincial election campaign last year or in the throne speech last month.
She also said ISC is highly profitable and the sale throws away that profit.
“The details that we heard today still leave a lot of questions for us,” said Sproule.
“You know what happens if this company turns out like Facebook where the initial share offering is a complete wipeout. Those are kind of things that we don’t know what’s going to happen once it actually goes up for sale.”
The Saskatchewan government has accused the NDP of being hypocritical over the ISC sale. The government has released a memo from 2004 that shows the former NDP government wanted ISC removed from a list of protected Crowns.
Crown corporations are highly-prized by many in Saskatchewan, including a group called Save Our Saskatchewan Crowns.
During the 2003 provincial election campaign, former Saskatchewan Party leader Elwin Hermanson mused about privatizing SaskTel _ something that was widely cited as one of the major factors in his party’s defeat.