Hitachi near to closing deal for British nuclear project

Hitachi Ltd, Japan’s largest industrial electronics maker, appears to be the highest bidder in the sale of British nuclear new-build project Horizon. The Horizon project plans to build 6 GW of nuclear capacity in the UK, where it already has two nuclear sites: Oldbury in Gloucestershire and Wylfa in Anglesey.

Japanese media said on Saturday the deal was expected to be worth more than 50 billion yen (£390.1 million) while analysts have put the value of Horizon at about 500 million euros (£401.3 million). Other bids have also been made by the Canadian counterparty SNC-LAvalin and Japan’s Westinghouse, along with its parent company, Toshiba Corp. France’s Avera surprised analysts earlier this month by pulling out of the race, announcing that it was instead bidding with China Guangdong Nuclear Power Holding.

Horizon’s current owners, German utilities E.ON and RWE, put the venture up for sale in March of this year. Both companies had been suffering from financial difficulties since Germany decided to end its nuclear power by 2022, following the Fukushima disaster. E.ON and RWE are thought to have debts amounting to approximately 75 billion euros (£60 billion).

In contrast with Germany, the UK is planning to significantly expand its nuclear industry, with new power stations expected to come on line by 2025 to replace ageing plants. A sale to Hitachi may prove controversial given that the company plans to build Advanced Boiling Water Reactors (ABWR), which are associated with the Fukushima nuclear plant that used an older Hitachi design of the same reactor. The building of ABWRs may however be some time from now as the new design is yet to be submitted to UK regulators and the design assessment process can take four years.

The new owner of Horizon will be officially announced on Tuesday.

Sources include: Reuters, Japan Today, The Telegraph, The Financial Times

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