THE JAPAN NEWS


 

 
Hitachi Ltd., Toshiba Corp. and Mitsubishi Heavy Industries Ltd. (MHI) have started talks on merging their nuclear fuel units, with the aim of reaching an agreement by the end of this year, it has been learned.

The most likely plan would be to establish a new holding company — with each firm investing one-third of the required capital — and place each nuclear fuel business under its wing.

As momentum for constructing new nuclear power plants has slowed globally since the accident at the Fukushima No. 1 nuclear power plant in Fukushima Prefecture, the government ultimately aims to merge the nuclear power plant businesses of Hitachi, Toshiba and MHI.

The merging of their nuclear fuel operations would likely be the first step in achieving the government’s goal, observers said.

Fuel orders at the three units have been decreasing due to the slow progress in restarting the nation’s nuclear reactors following the accident.
This has worsened their respective business conditions.

By merging fuel operations, Hitachi, Toshiba and MHI are expected to improve business efficiency due to the integration or closing of their production bases, as well as curbing procurement costs.

The three nuclear fuel units are: Global Nuclear Fuel, which was jointly financed by companies including Hitachi and General Electric Co.;
Nuclear Fuel Industries Ltd., whose major shareholder is Toshiba’s U.S. subsidiary Westinghouse Electric Co.; and Mitsubishi Nuclear Fuel Co., which is a joint investment between MHI and Areva.

Arrangements for the merger have already begun between the Japanese and foreign firms, according to the sources.