Toshiba to pull out of UK nuclear power plant project, wind up NuGen
November 12, 2018 – Toshiba has decided to wind up NuGeneration (NuGen), a subsidiary formed for the construction of a nuclear power plant on the West Cumbria coast in northwest England, and withdraw from the project.
NuGen had a capital stock of £381.9m (JPY56.7bn) as of 31 October 2018.
In June 2014, Toshiba acquired 60% of the outstanding shares of NuGen. Later, in July 2017, it acquired the remaining 40% from French company ENGIE when the latter exercised its right to sell its entire shareholding to Toshiba after Westinghouse Electric and other companies filed a petition under the US Bankruptcy Code.
Since then, Toshiba has held negotiations for the past 18 months with several potential new investors, but could not successfully conclude the negotiations. The company also considered selling its stake in NuGen, but realised that the sale will not be completed by 31 March 2019.
Due to additional costs involved in continuing to operate NuGen, Toshiba has decided to withdraw from the UK nuclear power plant construction project, and wind up NuGen.
Toshiba has also decided to wind up Advance Energy UK, a subsidiary established by Toshiba as a special purpose company for holding its shares in NuGen.
Toshiba expects to incur pre-tax loss of approximately JPY15bn ($132m) as a result of winding up NuGen and AEUL. The company also expects a loss of approximately JPY3.8bn ($33.3m) on the valuation of stocks of subsidiaries and affiliates related to AEUL.
Reacting to Toshiba’s announcement, NuGen said that it has retained a team to support the implementation of the winding-up process and will work with Toshiba and its other stakeholders.
In a statement, NuGen said that it will not be taking the project forward, but the Moorside site remains a site designated by government for nuclear new build, and it is up to the Nuclear Decommissioning Authority as the owner of the site and the government to determine its future.