TOKYO - Toshiba Corporation today announced that Westinghouse Electric Company, LLC. (Westinghouse), a Toshiba Group company, completed the acquisition of 100% of the shares of CB&I Stone & Webster Inc. (S&W), CB&I’s nuclear construction and integrated service business provider, on December 31, 2015. This transaction was closed in accordance with a Share Purchase Agreement between Westinghouse and CB&I dated October 27, 2015 (US time).
Westinghouse is currently engaged in two projects in the United States to provide AP1000™ pressurized water reactors (PWR) for the owners of Plant Vogtle and the owners of V.C. Summer Nuclear Station. In both projects, Westinghouse is responsible for plant design, engineering, procurement and support for construction, with S&W as a consortium partner. Following the acquisition, the scope of the construction carried out by S&W will be managed by Westinghouse and Fluor Corporation (Fluor), a major U.S.-based construction company.
With the acquisition of S&W, Westinghouse secures integrated end-to-end management and execution capabilities for all aspects of the current US projects and future projects. Westinghouse will also further enhance its construction expertise through cooperation with Fluor, which will hire and manage the workforce that completes construction of the current projects. Westinghouse expects these endeavors to drive forward successful completion of the construction projects and to strengthen its platform for implementing Engineering, Procurement and Construction (EPC) contracts.
At the time of the acquisition, Westinghouse also agreed to the revision of current EPC contracts with the owners of both US projects, under which all parties mutually withdraw claims and end pending litigation. Westinghouse will continue to cooperate with the owners on the current construction work to achieve the shared goal of safe and timely completion of both projects.
Westinghouse does not anticipate any material impact from the acquisition and settlements with the owners on its FY2015 forecast, but expects at least US$2 billion in annual revenue to accrue to its annual results in FY2016 and beyond, until completion of the US projects. Westinghouse will also recognize a certain amount of goodwill in its balance sheet, and will finalize its valuation through proper processes with outside auditors within 12 months of the completion of the acquisition.
Beyond the focus of today’s new-plant projects, the acquisition of S&W will support Westinghouse’s growth in nuclear power plant decontamination, decommissioning and remediation services; enhance its major nuclear project management and environmental service offerings; and add to its extensive innovation-driven engineering expertise. All of these businesses will reside in a new Westinghouse subsidiary WECTEC*1, which also will house a new government services business that is under development.
Westinghouse has a substantial record in constructing nuclear power plants around the world, and is also one of the world’s largest manufacturers of nuclear fuels; its PWR technologies are employed in approximately 50% of operating nuclear power plants. Westinghouse will further strengthen its leading position in nuclear power business with the acquisition of S&W.
