Mitsubishi Heavy Industries to Acquire 19.5% Stake in New Areva from Electricite de France

Published: Jul 10 2017
Deal Summary

Mitsubishi Heavy Industries, Ltd. (MHI), a manufacturer of heavy machinery for various industries, has agreed to acquire 19.5% stake in New Areva NP, a nuclear energy company, from Electricite de France S.A., a state-owned integrated energy company.

The acquisition will be based on a valuation consistent with that drawn up between EDF and AREVA for the stake held by EDF (i.e. a value for 100% of the capital of EUR2,500 million (USD2,720 million), on a debt-free cash-free basis, not including the effect of potential price adjustments). Concurrently, Assystem S.A., an independent nuclear engineering company, has agreed to acquire 5% stake in New Areva. The commitment made by Assystem will result in an investment of EUR125 million (USD135.97 million) to be made when New Areva NP will have been fully incorporated and the conditions precedent to its sale by AREVA will have been met.

Earlier on November 15, 2016, EDF has agreed to acquire a minimum of 51% stake and a maximum of 75% stake in Areva NP SAS, a designer and manufacturer of nuclear reactors and key components for nuclear power plants, from Areva SA, an integrated nuclear energy company, for a purchase consideration of EUR2,500 million (USD2,693.58 million).

New Areva is a 100% subsidiary of AREVA NP, that will combine AREVA Group’s activities relating to design and equipments’ manufacturing of nuclear reactor and, fuel design and assemblies manufacturing and services to the nuclear installed base.

Deal History:

Announced: July 10, 2017, MHI agreed to acquire 15% stake in New Areva from Electricite de France. The company has agreed to acquire 15% stake and may increase it upto 19.5%.

Update: On June 28, 2016, MHI and EDF have signed a memorandum of understanding (MOU) to forge a strategic and global collaborative relationship in the civil nuclear power fields. EDF and MHI intend to enhance their strategic cooperation by establishing general objectives and principles related to: (i) an updated cooperation framework regarding the ATMEA joint venture, including the involvement of EDF in ATMEA’s business operations, (ii) with mutual support to be brought for the smooth execution of ATMEA1 projects, in particular in Turkey and Vietnam, (iii) the potential participation of MHI as a partner in the French nuclear landscape reorganization with the acquisition of a minority equity interest in AREVA NP, (iv) potential broader range of collaborative ties leveraging the respective technologies and special expertise in the global market.

Planned: On November 24, 2015 MHI intended to acquire minority stake in New Areva NP from EDF.

Rumor: September 22, 2015, Mitsubishi Heavy Industries intended to acquire minority stake in Areva NP from Areva as reported by Nikkei, citing sources familiar with the matter.

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