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Canadian firm to purchase former Vogtle lead contractor Westinghouse

Canadian investment firm Brookfield Business Partners has entered into an agreement with Toshiba Corporation to purchase Westinghouse Electric Company for $4.6 billion.

The firm, a subsidiary of Brookfield Asset Management Inc., will fund the purchase through $1 billion in equity and $3 billion in long term-debt financing. In a statement, the company said the remaining balance would be covered through the assumption of certain pension, environmental and other operating obligations.

Brookfield Business Partners CEO Cyrus Madon said his company’s acquisition of Westinghouse will enhance the Pittsburgh-based company’s position as a leader in infrastructure services in the global power generation industry.

“Westinghouse is a high-quality business that has established itself as a leader in its field, with a long-term customer base and a reputation for innovation,” Madon said of the company’s investment in nuclear technology.

The purchase of Westinghouse is Brookfield’s first investment in the nuclear industry. According to the company, the transaction, which is subject to bankruptcy court approval, is expected to close at the third quarter of this year.

Westinghouse President and CEO José Emeterio Gutiérrez said the acquisition signified his company’s global leadership in nuclear technology.

“Our strategic restructuring process is creating a stronger, stable and more streamlined global Westinghouse business, for the benefit of our customers and employees,” said Gutiérrez.

The company filed for bankruptcy protection from its creditors in March after losing billions of dollars in cost overruns resulting from its contracts with Plant Vogtle in Georgia and V.C. Summer in South Carolina.

Until its bankruptcy filing in March, Westinghouse was the lead project manager for the two units at Plant Vogtle. Westinghouse continues to provide technology support for Vogtle after Georgia Power hired Southern Nuclear in July to take over construction management at the plant.

Westinghouse’s financial woes resulted in a decision in August by the owners of the V.C. Summer plant, Santee Cooper and Scana, to cancel construction at the plant.

The units at Vogtle and V.C Summer were deploying Westinghouse’s technology.

Last week, Scana entered into a $14.6 billion merger agreement with Virginia-based utility company Dominion Energy.

According to a statement from Dominion, the merger will help offset past and future costs related to the halted construction at the V.C Summer plant.

Dominion will also pay out $1.3 billion in cash payments to all Scana customers, averaging $1,000 per customer, 90 days after closing.

Contingent upon the approval of regulators in South Carolina, the merger would also help write off all related customer costs over 20 years instead of the previously proposed 50-60 years. 

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