Westinghouse Files For Bankruptcy Protection, 10 Years After Acquisition By Toshiba
- Author: Zachary Reyes Mar 30, 2017,
Mar 30, 2017, 9:25
Meanwhile, Toshiba president Satoshi Tsunakawa said the decision was geared toward "shutting out risks from the overseas nuclear business".
A bankruptcy filing would allow Westinghouse, whose nuclear plant projects have been dogged by delays and cost overruns, to renegotiate or break its construction contracts, although the utilities that own the projects would likely seek damages. Nuclear power is cleaner than generating electricity with coal or natural gas, but building a nuclear reactor is much more complex and prohibitively costly.
But the meltdown at Japan's Fukushima Daiichi nuclear power plant in 2011 changed things.
On Wednesday, Westinghouse Electric Company, a subsidiary of Japanese company Toshiba, filed for Chapter 11 bankruptcy protection. A statement issued in the United States of America said "Westinghouse's operations in its Asia and Europe, the Middle East and Africa (EMEA) Regions are not impacted by the Chapter 11 filings" though this does not specify if it applies to current activity only. The Pittsburgh-based Westinghouse unit is under construction.
Westinghouse's bankruptcy filing "is the only way for Toshiba to limit or determine the amount of loss at this point", he said. "Customers in those regions will continue to receive the high-quality products and services they have come to expect in the usual course as the regions will also be supported by the DIP financing".
The company building the first new U.S. nuclear reactors in a generation filed for bankruptcy Wednesday amid billions in losses from those troubled projects.
According to a statement from Westinghouse, the strategic reshuffling will attempt to resolve financial issues relating to its U.S. power plant projects, while protecting its core business.
The Japanese corporation said its net losses for 2016 could amount to just over 1trn yen (£7.23bn), more than double the 390bn yen (£2.82bn) it announced in February. Toshiba said in a statement.
Toshiba, on Wednesday, put WE liabilities at nearly $10bn (£8bn) as of December - saying that it expected its net loss for the current financial year to the end of March could top 1tn yen (£7.2bn).
The nuclear-to-electronics conglomerate is looking to finalize losses related to the unit within the current fiscal year ending Friday through the bankruptcy filing.
Chris Jukes GMB senior organiser said: "Westinghouse is to build the reactors for the new plant".
"There is a reason Westinghouse is exiting the process and bankrupt", Wise said, according to Reuters.
"Our commitment is still to try to finish these plants; that would be my preferred option", SCANA Chairman and CEO Kevin Marsh told financial analysts Wednesday. SCANA says in a press release that it plans to continue working with Westinghouse on the project.
Both would use the new Westinghouse AP1000 reactor, which was touted as a safer, cheaper option to older designs.
"The Office of Regulatory Staff is concerned about the status of those two nuclear units and what it will mean for those two units", Dukes Scott, executive director of ORS, said "We know what some of the [bankruptcy] options might be, but we don't know which option it's going to be".