Hitachi plans to put a U.K. nuclear power project on hold as discussions with the British government over funding hit a standoff, all but closing the book on Tokyo’s vision for nuclear infrastructure freights. Hitachi is prepared to vote on the intended suspension at its board meeting next week, the Nikkei business daily said without citing sources. Hitachi’s Horizon Nuclear Power unit has resisted to find investors for its plans to build a new power plant in northern Wales.
Hitachi said the property value of the plant in Wales was 296 billion yen as of the end of September. The special loss from halting the project is expected to be 200 billion to 300 billion yen, according to the Nikkei. A Hitachi spokesman said nothing has been decided on the suspension. Hitachi was expecting a group of Japanese investors and the British government would each take a one-third investment in the equity portion of the project. A company source has said the project would be financed one-third by equity, two-thirds by debt. On Friday, the firm said suspension of the project remained an option.
“No formal decision has been made in this regard currently, while Hitachi has been assessing the Horizon Project including its potential suspension and related financial impacts in terms of economic rationality as a private company,” it said in a statement. The UK government had been in formal negotiations with the Japanese firm over the pro Hitachi had taken on the planned construction of two reactors on the Welsh island of Anglesey after acquiring U.K.-based Horizon Nuclear Power in 2012.
After Hitachi Chairman Hiroaki Nakanishi discussed the project with British Prime Minister Theresa May last spring, London agreed to arrange more than 2 trillion yen in financing for the project, about two-thirds of the total cost. Japanese and British public-private consortia and Hitachi would each cover a third of the remaining 900 billion yen.ject since June. The Nikkei report comes later another Japanese industrial conglomerate, Toshiba Corp., scrapped its British NuGen project after its U.S. reactor unit Westinghouse went impoverish and it failed to sell NuGen to South Korea’s Korea Electric Power Corp. Shares of Hitachi rose by as much as 6% on the Tokyo stock exchange after the report.
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