Thread: Toshiba Buys BNFL's Westinghouse For $5.4 Billion

NEWS SNAP: Toshiba Buys BNFL's Westinghouse For $5.4 Billion
February 6, 2006


By Alex MacDonald and Brooke Donovan
Of DOW JONES NEWSWIRES

LONDON -(Dow Jones)- Japan's Toshiba Corp. (6502.TO) Monday finalized the purchase of nuclear-technology company Westinghouse Electric Co. for $5.4 billion - nearly three times what Westinghouse's parent first hoped to fetch at auction.

Toshiba President and Chief Executive Atsutoshi Nishida said the company will buy 100% of Westinghouse and retain a 51% stake in the company, selling the remaining minority stake to potential partners including U.S. and Japanese companies.

The sale of Westinghouse is expected to close in about six months, pending regulatory approval from the U.S. anti-trust authority, the Committee on Foreign Investment. Nishida said he doesn't expect any problems.

"We have completed our due diligence and are satisfied that this purchase is the right move for our business and our shareholders," Nishida said. "With Westinghouse, Toshiba will be a global nuclear power business organization."

Mike Parker, chief executive of British Nuclear Fuels Ltd. (BNF.YY), which owned Westinghouse, said the deal "will provide Westinghouse with (the ability) to compete more effectively for new U.S. customers."

Upon completion of the acquisition, Toshiba expects its nuclear power business to expand to three times the current level by 2015 as a result of operational and technological synergies, Toshiba said in a statement.

The company said it decided to acquire Westinghouse "in order to take an early lead in the promising global nuclear power plant industry."

The deal comes amid expectations of growing demand for a new generation of nuclear-power facilities because of volatile natural-gas prices, as well as cost and environmental concerns over other power sources like coal.

Toshiba, which makes electronic goods including DVD players, semiconductors, electric motors and power systems, is preparing for an expected surge of new investment in power plants in China, India and the U.S.

Westinghouse - one of the world's leaders in nuclear technology - is likely to design the plants and service them when they come online.

Westinghouse, with a work force of 8,500, has built most of the nuclear reactors in the U.S. In the year ended March 31 2005, it had $1.78 billion in sales and $153 million in net earnings.

When British Nuclear Fuels put Westinghouse on the block last year, initial estimates were for a price approaching $2 billion. BNFL had paid about $1.2 billion for the unit in the late 1990s.

Andrew Moulder, an analyst at equity and credit research firm Credit Sights in London, said Westinghouse is a sensible acquisition for Toshiba, given rising global demand for emissions-free energy.

"It looks like nuclear build will go ahead, and (therefore) it makes sense to own nuclear manufacturing assets and nuclear expertise at the moment," Moulder said.

Another utility analyst said it is hard to determine the value of a nuclear business "because it's hard to project how much demand there might be for nuclear" power plants. He added that Toshiba's all-cash bid of $5.4 billion "might be a bargain, or it might not."

At 1320 GMT Toshiba was trading down 0.53% or 4 yen at JPY744 ($1=JPY118.976).

Company Web site: http://www.bnfl.com

http://www.toshiba.com


-By Alex MacDonald, Dow Jones Newswires; 44 20 7842 9328; alex.macdonald@dowjones.com

(END) Dow Jones Newswires

02-06-06 0839ET

Copyright (c) 2006 Dow Jones & Company, Inc.

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http://www.smartmoney.com/bn/ON/index.c ... 00203-0839

Oh swell...so now we are dependent upon Arabs for Oil and the Japanese for nuclear power...or I assume it is nuclear power.

But wait, can't they enrich uranium from nuclear power fuel rods?

Right, if Iran can, the Japanese can.

Isn't Toshiba the one whose President fell on his sword after being discovered of having shared our secrets with an enemy?

Yep...that's the same Toshiba.

Leopards never change their spots whether they are in Tokyo or Washington DC.

Yup, it's nuclear power.

I found another article about the selling of US companies to foreign investors at http://www.cfo.com/printable/article.cf ... ?f=options.

The title is "Foreign firms are buying U.S. companies at the fastest clip in five years, creating concerns on Capitol Hill."

Let's see. Bush has been in power for five years, hasn't he?

Hmm.

Yep CountFlord....he sure has. Everything bad in our nation started 5 years ago. This is not a coincidence, but evidence of treason.

The only opinions I shall trust from this day forward are my own and those of my fellow citizens.---Judy

Good God Almighty! We could not have won WW2 without Westinghouse!

Westinghouse is the possessor of Tesla's research materials and devices under grant from the US govt. I hope to hell that the US Govt has enough sense to seize all of the Tesla materials from the vaults, warehouses, and electronic archives of Westinghouse before the transfer.

It is probably to late for that since most of Westinghouse is based on Tesla technologies.

Westinghouse is one of the core defense, energy, and large complex machinery corporations in America and has been fundamental to our evolution as a 1st world country.

There should be a law against selling them to a foreign nation or foreign national interest.

W

Don't these type of sales require US governmental approval?

Originally Posted by Politicalactivist

Don't these type of sales require US governmental approval?

Well, upon rereading the article, it appears that the company had already been sold to British Nuclear Fuels Ltd. They're now selling it to Toshiba.

I suppose that a year from now, Toshiba could sell it to the Saudi royal family, or perhaps to the Syrians or Iranians.

Ain't globalism grand?