Toshiba sells troubled Westinghouse after costs jump at USA nuclear reactor sites

Canadian fund to buy Westinghouse

Canadian fund to buy Westinghouse

The company's January 4 announcement said the $4.6 billion purchase price "for substantially all of the global business of Westinghouse Electric Company LLC and its affiliated debtors and debtors-in-possession excludes cash, but includes the assumption of certain pension, environmental and other operating obligations".

The deal, which still has to be approved by bankruptcy courts and clear regulatory hurdles, is expected to close in late 2018.

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An affiliate of Canadian alternative investment firm Brookfield Asset Management said this week it would acquire Westinghouse Electric Co LLC, the bankrupt nuclear services company owned by Toshiba Corp, for US$4.6 billion ($5.7 billion), Reuters reported. Those projects, plagued by delays and cost overruns, eventually led to its downfall, and Westinghouse has used the Chapter 11 process to distance itself from any obligations to them.

Now Westinghouse has been sold for $4.6 billion to provate equity fund Brookfield Businees Partners. And in November, Brookfield Property Partners offered to buy the remaining shares in General Growth Properties, adding to a large stake it purchased to bring the mall owner out of bankruptcy.

Those two business lines generated combined cash flow of $403 million on revenue of about $3.1 billion in Westinghouse's 2015 financial year, according to court records.

The deal excludes the two projects which helped bring down the company founded by George Westinghouse in 1866: plans to build four of its AP1000 reactors for US utilities in SC and Georgia.

One of Westinghouse's unfinished USA projects, known as Vogtle in Georgia, will continue with Southern Co. replacing the company as the project manager.

South Carolina Electric & Gas Co. abandoned construction reactors at the V.C. Summer Nuclear Station.

Westinghouse has joined a consortium bidding to provide nuclear power in Saudi Arabia, one of the biggest new markets in the world. The deal puts an end to a major headache for the Japanese conglomerate, which past year warned that it might have trouble surviving if it didn't find a buyer for the nuclear power plant constructor, which it acquired in 2006 for US$5 billion.

Toshiba stock rose about 2% in Tokyo following the news of the Westinghouse deal.

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