Electronics giant Toshiba said on May 25 that it would buy a $100 million stake in U.S. nuclear fuel producer USEC as Toshiba seeks a greater presence in the growing market for nuclear power plants.
The electronics maker, which also builds industrial components and nuclear power plants, will invest in United States Enrichment Corp. along with U.S.-based Babcock & Wilcox Investment Company. The latter will match Toshiba's investment.
USEC supplies more than half of the U.S. market and more than a quarter of the world market.
The funding represents a welcome vote of confidence for USEC, which has been seeking cash to build a centrifuge plant in Ohio that it says is the world's most advanced, after the U.S. government last year delayed loan guarantees.
USEC said it intended to use the funds to invest in the American Centrifuge Plant in order to produce low-enriched uranium for commercial reactors.
Under the deal Toshiba will acquire rights to receive enriched uranium necessary to fuel nuclear energy plants, a company statement said.
Toshiba is trying to tap rising demand for nuclear fuel plants. Earlier this year its Westinghouse unit announced it was buying Britain's Springfields Fuel.
Toshiba already has stakes in Kazakhstan's Kharasan uranium project and Canada's Uranium One. Last year it signed a deal with Russia's Tenex to cooperate on nuclear plant construction and in the civilian nuclear fuel business.
The U.S. Department of Energy last year delayed loan guarantees worth two billion dollars for USEC, saying the company was unready as it had failed to meet financial and regulatory standards for the guarantees.
Copyright Agence France-Presse, 2010