Westinghouse Gets Buyer Interest, Sees Talks Starting in Summer
(Bloomberg) -- Westinghouse Electric Co. has fielded interest from those looking at buying Toshiba Corp.’s majority stake in the bankrupt U.S. nuclear contractor and expects to begin a sale process in late summer, according to Westinghouse’s interim chief executive officer.
While Westinghouse has already received interest, it’s too early to be having conversations with potential buyers, interim CEO Jose Emeterio Gutierrez said in an interview Wednesday. The sale process will begin after Westinghouse gains approval of a business plan that it expects to file in bankruptcy court in early July, he said. Tokyo-based Toshiba put Westinghouse into bankruptcy on March 29 and has warned it may not be able to continue as a going concern because of losses from the business.
“We will start in late summer the process to sell the company,” said Gutierrez, adding that it’ll be part of a “very structured process” and that the company expects it’ll be sold before exiting bankruptcy or at the time of emerging.
Toshiba President Satoshi Tsunakawa has already said the company may sell the unit which has been hit with billions of dollars in losses from cost overruns on nuclear projects. Possible bidders may come from China or South Korea, which are developing their own reactors for export, and private equity firms. Apollo Global Management LLC won a bidding war to lend Westinghouse $800 million to fund operations as it tries to reorganize.
When asked whether Westinghouse was speaking with interested buyers in China or South Korea, Gutierrez said the company isn’t in talks with anyone yet. The Trump administration has taken steps to keep Chinese investors from trying to buy Westinghouse’s nuclear business, people familiar with the matter said last month.
Mark Marano, Westinghouse’s chief operating officer, said in a separate interview Tuesday that Tokyo-based Toshiba has “signaled pretty clearly to the market” that it wants to divest its majority stake in Westinghouse.
Toshiba shares were up 8.4 percent in Tokyo on Wednesday.
Westinghouse is meanwhile continuing to work with utility owners Southern Co. and Scana Corp. on getting nuclear reactors built in the U.S. Southern has agreed in principle to take the lead from Westinghouse on the two reactors it’s installing at the Vogtle plant in Georgia, and Gutierrez said he expects an agreement with Scana on its V.C. Summer project in South Carolina to be resolved by the beginning of June.
Southern has demanded intellectual property from Westinghouse that it says is needed to finish the Vogtle project. Gutierrez said Wednesday while attending the Nuclear Energy Assembly in Scottsdale, Arizona, that the contractor is open to sharing it to get the reactors done.