Japan's Toshiba Wins Nuclear-Power Assets Purchase of Westinghouse
May Open Door to Markets Like U.S., China and India
By DENNIS K. BERMAN
Staff Reporter of THE WALL STREET JOURNAL
January 24, 2006; Page A2
Toshiba Corp.'s successful bid to buy the nuclear-technology division of British Nuclear Fuels PLC underscores increasing optimism for nuclear power.
The seller's board will consider the bid, valued at more than $5 billion, later this week. Exact terms of Toshiba's offer weren't known yesterday.
Bidding for the nuclear-power and technology firm had escalated in the past few weeks. General Electric Co. had paired with Japan's Hitachi Ltd. to make a bid, and Japan's Mitsubishi Heavy Industries Ltd. also was interested.
Concerns about foreign ownership of the Pittsburgh-area company have sent Toshiba into negotiations with Shaw Group Inc. of Baton Rouge, La., whose potential involvement might mitigate congressional opposition to a deal, a person familiar with the matter said.
GE and Mitsubishi declined to comment.
Nuclear power has looked increasingly attractive in many nations amid advancing energy prices and concerns about rising emissions believed to cause global warming. Costs for energy sources such as coal have risen amid global expansion and China's increasing need for raw materials. China and India, especially, are looking to nuclear power as their consumption expands.
Meanwhile, emissions of the gases believed to cause global warming have risen despite efforts in many nations to adhere to the targets set by the Kyoto Protocol.
Improved reactor design has led to increased interest in the long-dormant U.S. market, which dried up in the early 1980s amid public outcry about safety and investors' dismay over high costs. Since then, manufacturers have continued to build reactors overseas in Asia and Europe, while the U.S. remains the most coveted market because of its economic might and hunger for new energy sources.
A Westinghouse purchase might help the acquirer gain ground in the rapidly expanding Chinese market, where electricity demand is attracting outside companies and investment.
Westinghouse has built the majority of nuclear reactors in the U.S. The Monroeville, Pa., company employs 8,500. It had $1.78 billion in sales and $153 million in earnings in the year ended March 31.
All of the bidders face political and legal sensitivities. Congress has shown increased concern about foreign buyers of U.S. technology and natural resources. Because the company already is owned by a foreign government -- and foreign buyers may purchase it -- lawmakers may have little grounds to block a sale. |
