France's EDF Ready to Bid for Areva's Nuclear Reactor Business

By Nadya Masidlover

PARIS--French power utility Electricité de France SA (EDF.FR) is set to make an offer for Areva SA's (AREVA.FR) nuclear reactor business in coming days, EDF's Chief Executive Jean-Bernard Levy said on French radio.

"We are preparing a proposal which we will address in the coming days ... for EDF to buy Areva's reactor business," Mr. Levy told Europe 1.

Nobody at Areva was immediately available to comment.

The comments come after the French state, which controls more than 85% of Areva, asked Areva and EDF to find a way of helping the beleaguered nuclear engineering firm, including EDF possibly taking over some of Areva's assets.

Mr. Levy said the nuclear reactor business would become a majority-owned subsidiary of EDF employing the 15,000 staff who currently build and operate nuclear reactors across the globe for Areva.

Mr. Levy said a purchase would be made at "a fair price, a market price." In an interview with French daily Le Figaro, Mr. Levy said the deal must include guarantees that EDF won't be exposed to risks linked to Areva's past, "in particular in Finland," he said.

In recent years Areva has suffered huge cost overruns at its two largest projects in Finland and in France, bad investments in uranium mines and a general slump in demand for new nuclear reactors after the Fukushima disaster in Japan four years ago.

After years of losses, Areva is currently in the midst of a major cost-cutting effort and earlier this month announced plans to reduce its global payroll by between 5,000 and 6,000 jobs.

Mr. Levy said, in Le Figaro, that EDF will also make "an alternative offer" which would be limited to the power utility employing 1,200 of Areva's engineers who currently work with EDF on a daily basis in "the conception and calculations" of nuclear safety for French nuclear reactors.

French utility Engie (GSZ.FR), formerly known as GDF Suez, has also said parts of Areva looked attractive.

EDF will hold its annual shareholders meeting on Tuesday.

-Write to Nadya Masidlover at [e-mail]

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