GE and Hitachi have signed a letter of intent to negotiate the formation of a global alliance that will combine their new nuclear power plant and services businesses.
The transaction will proceed through a cross-shareholding arrangement under which Hitachi will take a 40% holding in GE’s existing nuclear business and GE will take approximately 20% holding in Hitachi’s existing nuclear business. The parties anticipate that the transaction will be completed in the first half of 2007, subject to all required approvals and negotiation of the definitive agreement.
The move will strengthen GE and Hitachi’s existing boiling water reactor (BWR) capabilities in the light water reactor industry with potential areas of investment including new infrastructure, advanced reactor design, and service technology.
GE Energy president and chief executive John Krenicki commented: “Each business is contributing its existing nuclear power plant technology and service resources and assets to create a new alliance that will be the most comprehensive BWR technology and service provider in the world.”