Korea Electric Power Corporation (KEPCO) said it is considering the acquisition of U.S.-based nuclear power company Westinghouse Electric Co. However, it is only under the condition that “when it is offered the deal.”
KEPCO and the Ministry of Trade, Industry and Energy (MOTIE) are also interested in joining the NuGen consortium to establish Moorside nuclear power plants in the U.K.
An official from KEPCO said on March 6, “We are interested in nuclear business, so we are eyeing on Westinghouse. But, we haven’t received any offer and we have no intention to actively pursue the takeover yet.”
According to KEPCO and the MOTIE, Westinghouse is a U.S.-based nuclear power subsidiary of Japan’s Toshiba. Toshiba has about 80 percent stakes in the company. In 2006, Toshiba won a fierce battle for control of Westinghouse after offering US$5.4 billion (6.25 trillion won), which was more than twice the estimated acquisition price of US$2 billion (2.31 billion won), beating Mitsubishi Heavy Industries and General Electric (GE).
However, Toshiba made astronomical losses when the nuclear power industry fell into recession due to the Fukushima Daiichi nuclear disaster in 2011. The company announced last month that the final amount of losses for the nuclear power business stood at 712.5 billion yen (7.25 trillion won).
In addition, Toshiba failed to make profits with Westinghouse. Accordingly, the company announced it would sell its stake in Westinghouse and give up its control last month.
However, a suitable acquirer doesn’t appear. Mitsubishi Heavy Industries, Hitachi and GE show no interest in the business and France’s state-run utility company EDF flatly said that it had no plans to buy the business. On the other hand, KEPCO is seen as potential buyer for Toshiba’s nuclear unit as it supplied four nuclear reactors to the United Arab Emirates in 2009 and it is seeking to jump into a global leading nuclear power company.
Currently, Toshiba also has a 60 percent stake in the NuGen consortium, a project company for the development of Moorside nuclear power plants in the U.K., and plans to sell the stake as well.
KEPCO is also considering the investment in the NuGen consortium and the MOTIE is thoroughly reviewing whether to join or not. However, the MOTIE said that it is not considering the business as part of nuclear power plant exports which have been pushed ahead with from years ago since the nuclear power plants in the U.K. is different from those of South Korea.