France has approved the merger of state-owned Areva’s nuclear reactor business to a joint venture controlled by EDF.
According to a series of guidelines issued by the country, which aims at renewal of the French nuclear industry, Areva and its governing authorities will work in co-ordination with EDF under a global strategic partnership.
Office of the France President Francois Hollande has announced broad outlines of the deal, for which final details are yet to be negotiated by the two firms within a month.
France controls more than 80% in both the entities and intends to invest new capital ‘of the necessary amount’ in Areva as part of the deal, reports Associated Press.
This reshuffling of the atomic energy industry after Areva reported loss of almost €5bn, after it suffered losses in new reactor projects in France and Finland.
In May, Areva had announced its plans to reduce €1bn costs, which included reduction of up to 6,000 jobs.
The firm had received a $2.2bn preliminary offer from the power utility EDF for its nuclear reactor business unit at the end of May.
The deal is expected to allow Areva’s reactor and maintenance unit, Areva NP, to enter into partnerships with other domestic or overseas firms.
This transaction is likely to help Areva to meet nearly one third of its financing requirements.
Photo: Areva headquarters in Courbevoie, France. Image: courtesy of Olivier Passalacqua.