GE and Hitachi have signed a letter of intent to create a global alliance to combine and strengthen their nuclear power plant and services businesses.
<p>Under the terms of the alliance, the two companies will work to strengthen their existing operations, accelerate the development of new products and services, and position the alliance for growth in the nuclear energy industry. <br /><br />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. <br /><br />The move will strengthen GE and Hitachi's existing boiling water reactor (BWR) capabilities in the light water reactor industry, while positioning the alliance for expansion into new nuclear energy segments and technologies. Potential areas of investment include new infrastructure, advanced reactor design, and service technology. <br /><br />This is truly an historic moment for our two companies, said GE Energy president and CEO John Krenicki. 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. <br /><br />By taking this bold step together, GE and Hitachi are ensuring that both companies will be strongly positioned to compete effectively and grow in a sector worth billions of dollars, he continued. <br /><br />The two companies anticipate that the transaction will be completed in the first half of 2007, subject to required approvals.</p>