In a company statement on 28 March Toshiba Corp announced its intention to buy French power utility Engie's 40 % stake in their British nuclear joint venture NuGen for ¥15.3 billion ($138.5 million).
Toshiba owns the majority 60 % stake in NuGen, which plans to build three reactors at the Moorside site on the coast of Cumbria, UK, using Westinghouse's AP1000, and has scheduled electricity generation to start in 2025. The UK nuclear regulator has approved the AP1000 design but it is now unclear whether the reactors will be built.
The filing earlier in March for Chapter 11 bankruptcy protection by Toshiba's US nuclear unit Westinghouse Electric Co is defined in the JV terms as a ‘default event’ that allows Engie to exercise its option to sell its stake to Toshiba. Engie has confirmed its intention to sell its stake to Toshiba.
Toshiba said the transaction could cause a writedown of 49.7 billion yen ($450 m), but this has been already factored into its estimate of a net loss of 1 trillion yen ($9 bn) for the fiscal year that ended on 31 March.
The deal is a blow to Toshiba’s rescue policy of reducing risks from overseas nuclear businesses, part of which is to lower its stake in NuGen. Toshiba has made clear that ultimately it wants to withdraw fully from the nuclear power plant business overseas.The company will continue its attempts to seek new investors and to sell part or all of its stake in the company. One possible buyer is Korea Electric Power, which is currently in talks to buy part of NuGen.