After weeks of a fierce bidding war, the Toshiba Corp of Japan is near a deal to buy Westinghouse Electric, a builder of nuclear power plants, for about US$5 billion, a person involved in the talks said on Sunday.
Toshiba beat competing bids from General Electric, Hitachi and Mitsubishi Heavy Industries, and it is in exclusive talks with Westinghouse, this person said. Westinghouse, based in Monroeville, Pennsylvania is controlled by British Nuclear Fuels, which in turn is controlled by the British government.
Mitsubishi made an offer of more than US$2.5 billion for Westinghouse last summer, and the Wall Street Journal reported last week that GE and Hitachi had teamed up to make a US$3.5 billion bid. But Toshiba made a last-minute, higher offer, the person said.
Nuclear energy is gaining support with governments around the world amid high oil and natural gas prices, tight petroleum supplies and growing demand for electricity. Technology by Westinghouse is found in half the world's operating commercial nuclear power plants, according to the company's Web site. The company has 8,500 employees.
Since the 1979 Three Mile Island accident, no new nuclear power-plants have been built in the US. Opponents of nuclear power say the 1986 explosion of the Chernobyl power plant in Ukraine and the problems associated with the disposal of waste fuel illustrate the dangers of nuclear energy for the environment. But elsewhere, nuclear energy never lost the favor of governments who view it as a reliable source of energy.
Even in the US, the appeal of nuclear power has risen as prices for natural gas and coal, which power most US power plants, have risen in recent months.
Energy companies are seeking licenses around the country to build new power plants, notably in Alabama and Mississippi. The Bush administration, which is also encouraging the development of nuclear energy as a way to reduce dependence on foreign energy sources, is seeking to streamline the application process and permits needed to build new plants.
British Nuclear bought Westinghouse's nuclear business from the CBS Corp for US$1.1 billion in 1999, ridding the company of its last industrial vestige. The sale completed the transformation of what was once called the Westinghouse Electric Corporation into a media conglomerate.
The sale of Westinghouse to a Japanese company may raise security concerns with Iran is seeking to develop a nuclear program.