The UK Secretary of State considers that the acquisition constitutes a trigger event, and has ordered both EDF and GE to address certain security requirements, under section 26 of the National Security and Investment Act 2021
General Electric Global Operations Centre in Cincinnati, Ohio. (Credit: EEJCC/Wikipedia)
The UK government has raised national security concerns over the French state-owned utility EDF’s agreement to acquire General Electric’s (GE) nuclear turbine business.
The UK Secretary of State has ordered the two parties to address certain security requirements, under section 26 of the National Security and Investment Act 2021.
In May this year, the UK’s Competition and Markets Authority (CMA) approved EDF’s bid to acquire the GE Steam Power business, after an initial investigation.
GEAST UK, a wholly owned subsidiary of EDF Energy, will obtain control over GE Oil & Gas Marine & Industrial UK and GE Steam Power, upon closing.
GEAST UK will assume control over the GE units by increasing the percentage of its share in the entities from less than 75% to more than 75%.
According to the UK government, the acquisition constitutes a trigger event under section 8(2)(c) of the National Security and Investment Act.
The government said: “The Secretary of State considers that a risk to national security will arise because of the critical national security and defence capabilities relating to naval propulsion systems which are delivered through the GE Oil & Gas Marine & Industrial UK Limited and GE Steam Power Limited UK facility.”
The final order requires the parties to meet physical and information security requirements and implement governance arrangements to protect sensitive information.
The government will appoint a board observer on the board of GEAST UK, to observe board meetings of GE Oil & Gas Marine & Industrial UK and GE Steam Power.
The order requires establishing a steering committee of the GEAST UK board to enable compliance with security requirements and the protection of sensitive information.
In addition, they maintain capacity and capability in respect of critical Ministry of Defence programmes in the UK.
According to the UK government, the order is seen as necessary and proportionate as it addresses the risk to national security.