- MHI acquires 19.5 percent stake in Framatome, based on prior agreement from July 2017
- EDF and MHI to collaborate on ATMEA nuclear reactor joint-venture
Mitsubishi Heavy Industries, Ltd. (MHI) has completed investment into Framatome, a French company that designs and manufactures nuclear power plant (NPP) equipment and systems and renamed from New NP. MHI now holds a 19.5% equity stake in Framatome, an affiliate of Electricité de France (EDF) recently established as part of the reorganization of AREVA Group. The investment is aimed at establishing a global structure for delivering the latest technologies for safe and reliable nuclear power generation through strategic collaboration between MHI, Framatome and EDF. It will also support the promotion of sales of the ATMEA1 reactor through collaboration with EDF.
Framatome evolved from AREVA NP, an AREVA Group company with extensive experience in design and manufacture of NPP equipment, plant construction and fuel supply. Framatome will specialize in after-sale servicing of existing plants as well as fuel supply, and the design, manufacture and sale of reactor equipment for new plants; an area expected to generate stable earnings.
The completion of the investment will also result in a reorganization of ATMEA. ATMEA was formed as a joint venture between MHI and AREVA NP to develop the next-generation ATMEA1 reactor. Under the new structure, there will be fifty-fifty ownership of ATMEA between MHI and EDF, along with a special share owned by Framatome.
Following completion of the investment, MHI President and CEO Shunichi Miyanaga commented, "MHI has been a key player in cooperation between Japan and France in the development of nuclear power generation technologies for many years. With the completion of our investment into Framatome, a new structure has been created that will further strengthen the ties between our nuclear energy industries, and I am confident this new relationship will enable further improvement in technologies to ensure the long-term sustainability and reliability of nuclear energy."
Under the new arrangement, MHI, EDF and Framatome will collaborate in promoting worldwide sales of the ATMEA1 reactor. Further, cooperative ties between France and Japan's nuclear power industries will be strengthened in areas including equipment supply to NPPs, after-sale servicing, and decommissioning work.
Cooperation between MHI and the AREVA Group began in the 1990s with collaboration in the fuel cycle business. In 2006 the two parties concluded a wider cooperation agreement in the nuclear energy field. Following this, integration of the two partners' technologies resulted in development of the ATMEA1; a pressurized water reactor (PWR), in the 1,200 megawatt (MW) class, providing the world's highest levels of safety and reliability. Since that time, prospects for the sale of the ATMEA1 have been expanding worldwide, especially in emerging economies, where new NPP construction plans are moving ahead.
EDF is the world's largest provider of nuclear energy, currently operating a total of 73 NPPs in France and the UK. To date MHI has received orders for 15 replacement steam generators for EDF's plants, and strong ties of cooperation continue to be forged between the two companies. In June 2016 a memorandum of understanding (MOU) was concluded toward MHI and EDF's cooperation in the nuclear energy field; calling for EDF's marketing, technological and other support of ATMEA's business, plus broad-based cooperation across global markets making use of the two companies' respective technological capabilities and strengths.
Going forward, through the increasingly close ties forged with EDF, Framatome and the AREVA Group, MHI will promote the development of global markets for a broad range of nuclear power generation-related technologies. In this way, MHI will contribute to the formation of a worldwide structure enabling stable acquisition and supply of energy with low emission.
MHI is also scheduled to acquire a 5 percent equity stake in New AREVA Holding (formerly referred to as "NewCo"), a company primarily focused on the fuel cycle field business. The investment is due to be completed by the end of January 2018.