EC approves Areva restructuring

17 January 2017

The French government’s plans for restructuring state-owned nuclear reactor builder Areva have been cleared by  European union (EU) anti-trust regulators. A 10 January European Commission (EC) statement said the EC had concluded that French plans to grant a capital injection of €4.5bn ($4.75bn) to Areva are in line with EU state aid rules. The Commission added that other regulatory decisions were still needed, including approval by the EU of the buy-out of Areva’s reactor business by state-owned electricity supplier EDF.

The EC has, therefore, effectively approved  state participation in the capital increases of Areva SA and New Co, up to a maximum of €4.5bn out of a total amount of €5bn. Areva said this is subject to two preconditions: the EC's approval of the merger between EDF and New NP (Areva's reactor business), and the positive conclusion of tests by the French nuclear safety authority on the reactor pressure vessel for the Flamanville 3 EPR reactor.

In April 2016, France notified the Commission of a restructuring plan to restore its competitiveness. The plan provides for various divestments, in particular the group’s nuclear reactor business. Areva, which is 86.5% owned by the French state, will instead focus on the nuclear fuel cycle. France plans to help Areva bear the cost of restructuring by injecting public capital of €4.5bn. In September 2016, Areva began the transfer of its nuclear fuel cycle business to a new company, New Co Areva, which had made losses for the last five financial years. The restructuring will see the company split into three smaller companies and raise about €8bn in additional capital. 

New Co Areva subsequently announced the formation of Areva Nuclear Materials (ANM) as its subsidiary in the USA. ANM will be based in Washington DC and will contain the Areva D&D, TN Americas (formerly Areva TN), Areva Federal Services, Mining, Conversion, Enrichment Sales, and Areva Med business lines. Sam Shakir has been appointed as ANM's CEO.

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