| TOSHIBA ACQUIRES WESTINGHOUSE FROM BNFL
6 February, 2006
London, UK – February 6, 2006 – Toshiba Corporation announced today that it has entered into a definitive agreement with British Nuclear Fuels plc, under which Toshiba will acquire BNFL USA Group Inc. and Westinghouse Electric UK Limited (collectively Westinghouse hereafter). The acquisition, valued at 5.4 billion US dollars (approximately 621 billion yen), substantially expands the scale of Toshiba's nuclear systems business, positioning the company as a global competitor with world-class capabilities in the two most important standards for nuclear power systems: the BWR (Boiling Water Reactor) and the PWR (Pressurized Water Reactor).
Under the terms of the Purchase and Sale Agreement signed today, Toshiba will acquire 100% of Westinghouse. The extraordinary potential of this powerful combination has been met with immediate and positive reactions from several international companies involved in energy-related businesses. Toshiba expects to have several minority investors who wish to participate in this opportunity. Toshiba will retain more than 51% capital interest and remain the majority and controlling shareholder.
For Toshiba, the integration of Westinghouse and its extensive worldwide expertise in nuclear power generation and nuclear fuel has great significance in terms of taking Toshiba Group's energy-systems-related businesses to the next level. This powerful combination of Toshiba and Westinghouse's respective strengths and complimentary technologies and businesses will position the company as the world leader in the nuclear power business, with an unrivaled reach extending to both BWR and PWR systems.
Mr. Atsutoshi Nishida, President and CEO of Toshiba said, "It is with pride and pleasure that we will start to work with Westinghouse, a prominent industry leader, in the strategic growth area of nuclear power. With Westinghouse, Toshiba will be a global nuclear power business organization committed to delivering world-class nuclear power generation systems and services, backed up by proven technology, reliability and superb efficiency."
Mike Parker, Chief Executive of BNFL said, "We are delighted to have reached this agreement with Toshiba. It represents a truly unique opportunity for both companies. This partnership will provide Westinghouse with a truly global platform with new export opportunities that will enable us to compete more effectively for new U.S. customers. BNFL carefully considered which company would be the best for Westinghouse's business and is confident that Toshiba is the best choice."
Steve Tritch, President and CEO of Westinghouse Electric Company, said, "This is excellent news for Westinghouse customers and employees, because Toshiba has made it clear that they intend to invest in Westinghouse during this time of growing commercial nuclear power industry. This is a positive step in our ongoing journey to continually strengthen our position as the worldwide leader in our industry. Based on my personal interactions with Toshiba executives as part of the sale process, I believe they will be very good owners for our business."
Benefits of the Acquisition
Upon completion of the acquisition, Toshiba expects its nuclear power business to expand to three times today's level by 2015, as a result of operational and technological synergies. Toshiba is a leader in BWR technology, with a strong presence in the Japanese market. Westinghouse enjoys a leading position in the world market with its PWR nuclear systems and its nuclear fuel businesses. The combination of Toshiba and Westinghouse will leverage capabilities in manufacturing, sales and marketing, and in engineering and R&D. The complementary partnership will go beyond the simple addition of the two businesses and reinforce the ability to enter new business areas where the companies have found it difficult to operate individually in the past.
Business operation after the stock acquisition
Westinghouse will continue to operate from its headquarters in Pittsburgh, Pennsylvania. Westinghouse will retain its current intellectual property, equipment and employees, and necessary resources will be channeled to its operations to assure further business expansion. Development and marketing efforts for the AP1000 business will continue, focusing on winning new orders in the USA, China and elsewhere. Westinghouse will also continue to renovate commissioned nuclear power plants and to promote its nuclear fuel processing business.
Toshiba will work closely with Westinghouse's management team to develop future strategies, in order to maximize synergies and create new business opportunities..
Approvals and Timing
About Westinghouse's nuclear business
Toshiba's nuclear business
Toshiba has defined electronic device and digital products businesses as high-growth domains, and supports them with strategic, proactive investment in semiconductors and other promising fields. The company has also defined its power generation and social infrastructure systems businesses as stable growth businesses backed by substantial resources. The company decided to acquire Westinghouse in order to take an early lead in the promising global nuclear power plant industry.
Company outlinesBritish Nuclear Fuel plc
Westinghouse Electric Company
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