- Good morning. The Alberta government says it has cancelled negotiations with two companies owned in part by Sam Mraiche. Today, we take a closer look at the Edmonton entrepreneur whose pandemic-era deals, political connections, and skybox hockey nights have put him at the centre of a growing controversy.
Up first
In the news
Banks: Fairstone Bank of Canada is buying Laurentian Bank of Canada in an all-cash deal worth $1.9-billion. Laurentian is also selling its retail business to the National Bank of Canada.
Housing: Federal spending on housing is projected to drop by more than half over the next three years, a finding that is at odds with the Liberal Party’s campaign pledge.
Mining: Global mining giants Vale and Glencore are evaluating a joint venture in Sudbury that could lead to a US$2-billion copper project that would extract the critical mineral over more than two decades.
While the spotlight shines on Alberta Premier Danielle Smith at a Vancouver NHL playoff game last year, Sam Mraiche, at top centre right with his hand under his chin, watches the Oilers and Canucks play.DARRYL DYCK/The Canadian Press
In focus
The man with the suite view
Sam Mraiche was growing impatient.
On the other end of the line was Iqbal Sunderani, the chief executive of BTNX Inc., the company supplying COVID-19 rapid tests to Mraiche’s firm, MHCare Medical Corp. MHCare was working to secure COVID-19 test kits for Alberta Health Services.
Sunderani was explaining why the rapid tests were not arriving as quickly as MHCare wanted. Governments in Ottawa and Ontario were ahead in the queue, he said. Manufacturers were behind. There was only so much he could do.
“Do you know what you’re doing to me, Iqbal?” Mraiche said during the call in February of 2022, according to transcripts filed as part of a lawsuit over the deal. “I don’t only sell rapid test kits. I’m one of the biggest constructors here, too. Do you know what you’ve done to me? I’ve had so much mud thrown on my face, it’s not even funny.”
“You better hope there’s another wave that needs rapid tests,” he continued later in the call.
“Sam, that’s – that’s a bad thing to hope for,” Sunderani replied.
“Is it? Me and you are in the business.”
“Sam, you know what? At the end of the day I don’t know about you, but I’ve made enough money. I don’t want to wish –”
“Has Jeff Bezos made enough money yet?”
“I don’t care who Jeff Bezos is,” Sunderani said. “He has – I mean, I don’t want to wish –”
“No one’s wishing anything. It’s just going with the flow,” Mraiche said.
A month after that call, BTNX sued MHCare, alleging the company failed to pay for more than 200,000 test kits and refused to pay for a truckload delivered in error. MHCare countersued, alleging BTNX overcharged, caused it to lose money and damaged its reputation. The two companies remain in litigation, and none of the allegations have been proven in court.
The exchange surfaced during a multinational investigation by The Globe and Mail into Mraiche’s rise – from early legal and financial trouble in Edmonton to a sprawling business portfolio in Alberta and overseas, including more than 60 civil court disputes, before his company MHCare became a major supplier of masks, gowns and other equipment to Alberta Health Services during the pandemic.
An ambulance donated by Sam Mraiche is parked outside a clinic in the town of Joub Jannine in the Bekaa Valley, Lebanon.Oliver Marsden/The Globe and Mail
In Lebanon’s Bekaa Valley, his family’s home region, he’s regarded as a generous donor who helped residents after the 2020 Beirut port explosion – including the donation of a badly needed ambulance to the town of Joub Jannine. (When The Globe visited in the spring, the ambulance sat parked near the town centre, adorned with the words, “Sponsored by: Sam Mraiche.”)
In Canada, as MHCare’s business expanded, so did his proximity to political power – playing host to politicians and later appearing in photos with the Alberta Premier and senior officials at NHL playoff games.
Mraiche’s connections to senior political staff and government decision-makers were more extensive than previously reported – including being present with the premier’s top advisers in a private suite on election night in 2023, the investigation revealed.
Those revelations have intensified scrutiny of Mraiche’s business dealings with the province, which are now the subject of examinations by Alberta’s Auditor-General and the RCMP.
In a wrongful-dismissal suit, former AHS chief executive Athana Mentzelopoulos alleges she was fired for investigating alleged conflicts of interest between her staff and certain companies. She also alleges she was under pressure from the Smith government to proceed with contracts with private surgical facilities in which Mraiche is a part-owner. Yesterday, the province announced it was cancelling those deals.
Mraiche, through his lawyer, denies any suggestion of improper conduct and says his companies were built through work ethic and entrepreneurship.
The Alberta government disputes allegations of political interference, saying Mentzelopoulos was fired for failing to execute its agenda and incompetence. None of the allegations tied to the wrongful dismissal suit have been tested in court, and MHCare is not part of the lawsuit.
The Globe’s full investigation – with reporting from Edmonton, Calgary, Lebanon and Toronto – can be found here.
Charted
Out of real estate, into the stock market
For many younger Canadians, the door to homeownership slammed shut early in the COVID-19 pandemic, Tim Shufelt writes. Many of them soon found refuge in an unlikely place – the stock market
Quoted
None of us want to be in a situation where we are told we have no cards. We have great cards in our energy and natural resources,”
— Natural Resources Minister Tim Hodgson
Responding to an AFN resolution rejecting changes to an oil tanker ban, Hodgson said the country’s economy is under attack, and Canadians expect the government to respond to it.
Up next
More files we’re following
At the bell: Royal Bank of Canada and National Bank of Canada report fourth-quarter results this morning. Yesterday, Bank of Nova Scotia beat profit estimates, driven by its capital markets and wealth management divisions.
- Toronto-Dominion Bank, Bank of Montreal, and Canadian Imperial Bank of Commerce wrap up the Big Six earnings tomorrow.
By the numbers: Statistics Canada’s labour productivity report is expected to show another dip in output, continuing a trend the Bank of Canada has called a crisis.
Morning update
Global stocks were on steadier footing as an expected rate cut from the U.S. Federal Reserve next week improved market sentiment.
Wall Street futures were in positive territory, while TSX futures also pointed higher.
Overseas, the pan-European STOXX 600 was up 0.12 per cent in morning trading. Britain’s FTSE 100 edged down 0.18 per cent, Germany’s DAX gained 0.15 per cent and France’s CAC 40 gave back 0.05 per cent.
In Asia, Japan’s Nikkei closed 1.14 per cent higher, while Hong Kong’s Hang Seng dropped 1.28 per cent.
The Canadian dollar traded at 71.71 U.S. cents.