FINAL offers for Westinghouse, the nuclear power station builder put up for sale by British Nuclear Fuels, will be made this weekend and are expected to top $3 billion (£1.7 billion).
The winning bidder is expected to be confirmed at BNFL’s regular board meeting on Thursday and an announcement will follow soon after.
Interest is understood to have surpassed expectations and the price achieved for the sale is likely to be significantly higher than the $2 billion originally anticipated. The four competing parties have been whittled down to three but there is considerable jockeying for position in the final stages.
GE, the US conglomerate that has built most of America’s nuclear reactors, is understood to have paired up with Hitachi of Japan to make its bid. However, it is still thought to be trailing the other remaining bidders — Mitsubishi Heavy Industries and Toshiba of Japan.
Mitsubishi is believed to have teamed up with the Washington Group, a major US contractor in the nuclear sector, while Toshiba is now working with Shaw Group, the Louisiana-based company that had been bidding separately.
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Carlos Gutierrez, US Commerce Secretary, is understood to have written to Alan Johnson, the Secretary of State for Trade and Industry, pressing the case for GE’s bid. Mr Gutierrez wrote on January 12 saying that the “Bush Administration supports General Electric’s bid”, adding that a “successful GE bid could promote the ongoing global development and introduction of new US technology for nuclear energy and would increase GE’s presence in the United Kingdom”.
People close to the auction process said that the winning bidder may not be announced immediately, because there are sensitivities whichever is the victor. GE, a major nuclear player, would be likely to encounter antitrust problems because it will have a monopoly on nuclear fuel supply in the US. If one of the Japanese bidders wins, the transaction will have to be referred to the US Committee on Foreign Investments.
Although Westinghouse has a British owner, most of its 8,000 staff and headquarters are in the US and the sale is considered a threat to national security by some on Capitol Hill. Toshiba’s decision to work with Shaw will soothe the concerns of some US politicians. The buyer is likely to have to promise not to hand over sensitive technology to countries such as China or Iran.
America’s Nuclear Regulatory Commission will also have to approve the deal.