No profit guarantee for N.S. in TrentonWorks deal with Daewoo, premier says
3/11/2010HALIFAX, N.S. - Nova Scotia Premier Darrell Dexter has revealed there is no guarantee that any potential profits from a wind turbine manufacturing plant will flow into government coffers despite a 49 per cent equity stake funded by taxpayers.
Dexter says the decision on what to do with any profits made by South Korean manufacturing giant Daewoo Shipbuilding as a result of its $90-million revitalization of the former TrentonWorks railcar facility will be made by the new company's board of directors.
Earlier this week, Economic Development Minister Percy Paris said any profits from the province's share of the company would go into provincial coffers.
But Dexter now says the board, which will have one member representing the government, can decide to pay out any profits in dividends, retain the money as earnings for a set period, or use the money to reinvest in the company.
He says any notion that the choice between dividends and investment in the company is somehow a bad thing "doesn't bear any real scrutiny."
Dexter says shareholders stand to benefit when a company makes money either because the capital value of the company will increase, or because they will receive the dividends.
The Canadian Press
