KEPCO Selected as Preferred Bidder for Acquisition of Toshiba’s NuGen Shares

The Korea Electric Power Corporation (KEPCO) announced on December 6 that it has been selected as the preferred bidder for the acquisition of Toshiba’s shares in NuGen.

The KEPCO and Toshiba are going to move ahead with negotiations for share acquisition for months to come. The KEPCO can acquire the shares from Toshiba once the negotiations are completed smoothly along with the South Korean government’s preliminary feasibility study and the UK government approves of the change in the ownership of NuGen. The KEPCO is expecting that it will be able to sign a share acquisition contract in the first half of next year.

At present, Toshiba owns 60% of the NuGen consortium, which is leading the Moorside Nuclear Power Project. This project is to build three nuclear reactors in North West England at an investment of 15 billion British pounds. The construction of the reactors with a total capacity of approximately 3 GW is scheduled to be completed in 2030. The shares of Toshiba are estimated to worth 300 billion won or so. Toshiba acquired Westinghouse Electric Company in 2006 for US$5.4 billion, but recently decided to withdraw from the nuclear power industry after incurring losses.

The KEPCO is expected to pursue the goal with its APR 1400 reactor, which was developed by South Korea and recently exported to the UAE. The standard design of EU-APR, which is a modification of the APR 1400 reactor for use in Europe, already satisfied the European Utility Requirements (EUR) in October this year.

The Moorside Project is characterized by the operator being in charge of financing for the construction and then retrieving its investment by selling electricity after the completion of the construction. As such, the financing capabilities of the KEPCO and its consortium partners are expected to hold the key to the future progress.