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Toshiba plans to sell US nuclear division Westinghouse and raise £4bn

James Titcomb
Toshiba is struggling to stay on the Tokyo Stock Exchange - AP

Toshiba has announced plans to sell Westinghouse, its bankrupt nuclear reactor business, in a move that could help rescue the stricken Moorside nuclear power plant project in Cumbria.

The embattled Japanese conglomerate announced on Sunday that it would raise 600bn yen (£4bn) as it seeks to shore up cash to avoid being de-listed from the Tokyo Stock Exchange.

The funds will be used to guarantee any claims against Westinghouse, the US nuclear reactor business, which was meant to build the reactor for the proposed plant in Cumbria but filed for bankruptcy earlier this year.

Toshiba currently owns the NuGen project to build the nuclear plant but has said it is unable to fund it given the company’s enormous financial difficulties, which stemmed from having to write down billions after the collapse of Westinghouse.

A sale of the US business, which aims to emerge from bankruptcy soon, may clear the way for a separate investor to take the NuGen project forward, although potential bidders have suggested they may rely on other reactor suppliers.

An artist's impression of the Moorside plant in Cumbria Credit: NuGeneration

“Toshiba intends to sell its claims, including reimbursement, against Westinghouse and interests held by it related to Westinghouse to a third party,” the company said after a board meeting yesterday.

“If such a sale is successfully made, Toshiba is expected to be able to significantly reduce its internal resources it had to allocate to the rehabilitation proceedings of Westinghouse and focus its internal resources on its new businesses.”

Private equity giants Blackstone and Apollo are among those considering a bid for Westinghouse, while purported investors in the NuGen Moorside project include China General Nuclear.