Brookfield explores sale of stake in nuclear firm Westinghouse -sources

Brookfield Business Partners LP

23/04/2021 22:16

By Joshua Franklin and David French
    April 23 (Reuters) - Brookfield Business Partners  BBU_u.TO 
is exploring options including the sale of a minority stake in
Westinghouse Electric Co that could value the U.S. nuclear power
developer and servicer at as much as $10 billion including debt,
people familiar with the matter said on Friday. 
    The sale plans come as the nuclear power sector may benefit
from President Joe Biden's push to tackle climate change. Biden
unveiled a target to slash America's carbon emissions by the end
of the decade to 50% of what they were in 2005, and included
nuclear power in the potential energy mix to achieve this goal.
 urn:newsml:reuters.com:*:nL1N2MF14N
    While critics argue it is more expensive than renewable
power sources and poses heightened safety risks, Westinghouse is
among the companies seeking to develop smaller nuclear reactors,
which are billed as cheaper and easier to deploy.
    Brookfield Business Partners has hired investment banks to
engage with potential buyers for a minority stake in
Westinghouse, the sources said, requesting anonymity as the
discussions are private. 
    The sources cautioned that there is no certainty Brookfield
will find a buyer and that an outright sale of the company is
also an option. Brookfield Business Partners and Westinghouse
declined to comment.
    Brookfield Business Partners Chief Executive Cyrus Madon
said on a Feb. 5 earnings call that it could "test the market"
in relation to Westinghouse.
    "We could hang onto it and continue milking these incredible
cash flows, but it will all come down to what's the value we can
get versus what we can create by keeping it," Madon said.
    One of the most storied names in the American power
industry, Westinghouse was acquired by Brookfield Business
Partners, an affiliate of Canadian asset manager Brookfield
 BAMa.TO , in 2018 for $4.6 billion, including debt, from
Toshiba Corp  6502.T .
    Westinghouse's earnings before interest, tax, depreciation
and amortization (EBITDA) were $650 million in 2020, up from
$440 million in 2018. On the February call, Madon said dividend
payments from Westinghouse had almost covered Brookfield's
initial equity investment.

 (Reporting by Joshua Franklin and David French in New York;
Editing by Cynthia Osterman)
 ((davidj.french@thomsonreuters.com; +1 646 223 5211; Reuters
Messaging: davidj.french.thomsonreuters.com@reuters.net))