Toshiba buys Westinghouse nuclear power stake from Shaw for $1.6 billion
By Adam Westlake / October 10, 2012 / No Comments
Japanese electronics manufacturer Toshiba Corp. announced today that it has reached a deal with Shaw Group Inc. to buy their 20% stake in Westinghouse Electric Co., a U.S. nuclear power plant company. After the ¥125 billion (approx. $1.6 billion) purchase, Toshiba’s ownership of Westinghouse will rise to 87%. The cash settlement is said to be completed by January 2013, and the Japanese company will use any on hand funds as well as loans to close the deal.
Westinghouse already has construction plans underway for four nuclear reactors in the U.S. and another four in China, and aims to achieve business growth by further expanding its global sales.
After Shaw’s exit from ownership, Toshiba says it will be in charge of selecting future nuclear plant development projects and partners on a case-by-case basis. Toshiba has also already received offers from potential investors in Westinghouse, and while the Japanese company reveals they are open to talks, it will be a condition that they retain a majority ownership.
Toshiba originally bought a 67% stake in Westinghouse for $4.16 billion in October 2006. Management control was given to Toshiba, while Shaw then agreed to buy one-fifth of the company for $1.08 billion. In August of this year, Toshiba revealed that it was already looking into selling as much as 16% of the U.S. nuclear power company, part of a strategy to increase the chances of getting contracts in developing countries.
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