Brookfield, Cameco partner to buy nuclear services company Westinghouse in $7.9B deal

Dive Brief:

Brookfield Renewable Partners and Cameco Corp. are forming a partnership to buy Westinghouse Electric Co., a nuclear services company, in a $7.9 billion deal as part of an effort to take advantage of a resurgence in nuclear generation, the companies said Tuesday.
Brookfield and its institutional partners expect to spend about $2.3 billion for a 51% stake in Westinghouse and Cameco expects to spend about $2.2 billion for the remaining share of the company under a deal set to close in the second of half next year. Westinghouse will retain about $3.4 billion in debt.
“Every credible net-zero pathway relies on significant growth in nuclear power,” Mark Carney, Brookfield vice chair and head of transition investing, said in a statement. “It is an essential, reliable zero-carbon technology that directly displaces fossil fuels and supports the growth of renewables by providing critical baseload to our grids.”

Dive Insight:

Driven by electrification, decarbonization and energy security benefits, roughly 400 GW of new nuclear capacity will be needed by 2050, Brookfield and Cameco, a uranium company, said in describing the market trends that helped drive their planned Westinghouse purchase.

Also, nuclear power is experiencing a global resurgence with more than 50 GW of announced plant extensions and more than 60 GW of new reactors expected between 2020 and 2040, the companies said.

In addition, there are opportunities in next-generation advanced nuclear technology and long-term nuclear energy storage, according to the companies. “Modular baseload generation, such as Westinghouse’s eVinci micro-reactor technology, can play a growing role in an increasingly decentralized and decarbonized energy system,” they said.

Brookfield Business Partners bought Westinghouse out of bankruptcy in 2018 from Toshiba Corp. for $4.6 billion. Brookfield Business Partners said Tuesday it expects to garner about $1.8 billion from the sale of its stake in Westinghouse, with the balance distributed to institutional partners.

Westinghouse services about half the nuclear power generation sector and is the original equipment manufacturer to more than half the global nuclear reactor fleet, Brookfield and Cameco said.

“With strong growth projected in the nuclear energy market, Westinghouse is well positioned to increase business in its core fuel and services segments, execute on the growing pipeline for extending and uprating nuclear power plants, and service the rising demand for new utility-scale and modular baseload nuclear power generation,” the companies said.