AREVA Restructure to Focus on Nuclear Fuel

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Troubled French engineering giant AREVA SA (EPA:AREVA) (Paris, France) has outlined its restructuring plan to 2020, which will see the creation of a new company focused on the nuclear fuel cycle.

The company also confirmed plans to sell a majority stake of its nuclear reactor business to Électricité de France S.A. (EPA:EDF) (Paris, France) for 2.7 billion euro ($2.96 billion). For additional information, see August 4, 2015, article--EDF to Take AREVA's Nuclear Business in $2.96 Billion Deal.

The company plans to create what is being tentatively called "New Co" later this year, which will be a wholly-owned subsidiary of AREVA. It will combine AREVA Mines, AREVA NC, AREVA Projects and AREVA Business Support and their subsidiaries. It will focus on all aspects of the nuclear fuel process. Following the sale of assets and other measures, including nuclear measurement and instrumentation specialist Canberra (Meridien, Connecticut), both AREVA and New Co will benefit from a combined capital increase of 5 billion euro ($5.7 billion).

Philippe Knoche, chief executive officer, said: "Today, we present the roadmap for AREVA's continued transformation. This program defines the major stages necessary to the creation of New Co, a separate new entity refocused on the mining, front-end and back-end operations. The roadmap specifies the conditions for the transfer of AREVA's reactor-related operations to EDF and the refocusing of our group on fuel cycle management."

He added: "By means of the solutions it can provide for uranium supply, for its conversion into fuel, and for nuclear fuel recycling, waste management and dismantling, New Co will be in a good position to grow in global nuclear markets. The strengthened capital structure, the new industrial plants and the reinforcement of New Co's technology and innovation base will underpin this strategy."

Despite selling a controlling share of its nuclear business to EDF, AREVA will retain control over the troubled Olkiluoto 3 nuclear project in Finland. Crippling delays with its European Pressurized Reactor (EPR) nuclear projects at Olkiluoto and Flamanville in France have cost the company billions of euro in overruns.

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