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Three Japan conglomerates aim to merge nuclear fuel operations
[TOKYO] Three Japanese conglomerates are in talks to combine their loss-making domestic nuclear fuel operations, a person with direct knowledge of the matter said, as the outlook for restarts of reactors following the Fukushima nuclear crisis remains bleak.
Hitachi Ltd, Toshiba Corp and Mitsubishi Heavy Industries Ltd aim to merge the operations as early as spring 2017, the person said, declining to be identified as the discussions were confidential.
The person added that the three companies may eventually consider merging their nuclear reactor businesses, though nothing specific has been discussed so far.
The companies said they were considering options for their domestic nuclear fuel businesses but no decisions had been made.
Public opposition as well as regulatory and safety obstacles have meant that only three of Japan's 42 reactors are online after they were idled in the wake of the 2011 earthquake and tsunami that destroyed Tokyo Electric Power Co's Fukushima Daiichi power station.
The person with direct knowledge of the matter said the three firms were aiming to reach a preliminary agreement by the end of the year.
"We have to think of something for the domestic nuclear fuel business," said another person familiar with the matter.
The conglomerates are likely to first form a joint holding company for their fuel businesses before merging them into one entity, the Nikkei business daily reported earlier on Thursday.
A spokesman for Japan's Fair Trade Commission declined to comment on whether the antitrust regulator would examine any merger plan proposed by the three companies.
Toshiba, through its US unit Westinghouse, also has overseas nuclear fuel operations.
Hitachi has a global nuclear power alliance with General Electric Co while Mitsubishi Heavy has one with France's Areva SA.
Hitachi's shares gained 2.6 per cent in early trade in Tokyo, while Mitsubishi Heavy up 2.3 per cent.
Toshiba's stock fell 2.1 per cent compared with a 1.4 per cent rise in the benchmark Nikkei 225 index.