France seeking Asian investors for Areva-EDF reactor unit

Tokyo: France on Monday shed light on its plans to revamp troubled nuclear group Areva, including injecting 2.5 billion euros (USD 2.9 billion) in cash and selling a third of the reactor unit to an Asian investor.

"We are looking for a partner for a one third stake," a government source said on the margins of a visit by Prime Minister Manuel Valls and Economy Minister Emmanuel Macron to Japan.

Paris has sought to restructure the loss-making mainly state-owned Areva by splitting off its uranium mining and refining business from the nuclear reactor unit, which will be taken over by electricity group EDF, also mostly state-owned and which builds reactors.

In July EDF said it would purchase between 51 and 75 percent of nuclear reactor unit Areva NP for an amount valuing the entire affiliate at 2.7 billion euros, but details have since been slow emerge.

The government source said EDF would hold 51 per cent of the reactor unit and Areva 15 percent.

Chinese and Japanese companies are contenders for the remaining one-third stake.

Areva has been casting around for investment, notably from China, and Valls said he was open to the idea of Japanese conglomerate Mitsubishi Heavy Industries taking a capital stake.

Valls told Japan's Asahi daily that "everything is possible" in a nod to discussions with Mitsubishi, an Areva partner in the Atmea pressurised water reactor.

With Areva's financing needs estimated at 7 billion euros through 2017, some 3.4 billion needs still to be found, most of which is likely to come from the French state pumping more cash into the company.

The government source said the amount would be between 2.5 to 3.0 billion euros.

Once a world-beating force in the global civil nuclear sector, Areva encountered significant financial problems following the 2011 Fukushima disaster in Japan, which left several countries including Germany looking to phase out nuclear energy.

The firm also hit severe construction difficulties with its first EPR reactor in Finland, leaving a nearly 4.0-billion-euro bill and lifted Areva's debt to some 6.0 billion euros mid-year.

That encouraged Paris to push for a quasi-merger with EDF to save what it could in the company. Some 6,000 jobs are expected to be cut as part of the restructuring.