The filing allows Westinghouse to prepare for a public listing and share information privately with regulators.Keith Srakocic/The Associated Press
Nuclear reactor vendor Westinghouse Electric Co. has confidentially filed for a U.S. initial public offering, its owners revealed on Friday, as demand for new sources of nuclear power attracts renewed interest from investors.
Westinghouse is jointly owned by Brookfield Asset Management Ltd. BEP-UN-T, through its renewable energy arm, and Saskatoon-based uranium fuel provider Cameco Corp. CCO-T
The number of shares to be offered and the price range for the public listing have not yet been set, and the proposed IPO and its timing will depend on market conditions, Cameco said Friday. But the filing allows Westinghouse to prepare for a public listing and share information privately with regulators.
Nuclear energy is making a comeback as demand for electricity surges, especially to serve the rapid development of data centres that train and run artificial intelligence models.
Only eight years ago, Westinghouse was in bankruptcy when Brookfield’s private equity arm bought the company from Toshiba Corp. for US$4.6-billion.
Four years later, Brookfield’s private equity business sold Westinghouse to Cameco and Brookfield Renewable Partners LP, the company’s renewable energy arm, for US$4.5-billion plus US$3-billion in assumed debt. Brookfield kept a 51-per-cent stake, and Cameco owns 49 per cent.
Westinghouse has a decades-long track record in the nuclear sector and a head start on many of its rivals. More than half of the nuclear reactors operating around the world use its technology, according to the company.
Last year, Westinghouse and its owners reached an ambitious deal with the United States government that seeks to build eight to 10 large nuclear reactors at a cost of at least US$80-billion.
If certain milestones are met – including Westinghouse reaching a valuation of US$30-billion – Westinghouse would be compelled to hold an IPO and the U.S. government would be allowed to take an 8-per-cent stake in the company.
The pursuit of such a lofty valuation for Westinghouse is a signal of the sharp reversal in fortunes for the nuclear sector, which is seeking large amounts of capital from investors for its expansion plans.
U.S. President Donald Trump has outlined a plan to jumpstart America’s nuclear industry. And Canada has a strategy to fast-track small modular reactor construction, while also adding more large-scale reactors in the country.
Brookfield Asset Management chief executive Connor Teskey said Friday that the U.S. Department of Energy has committed up to US$17.5-billion in loans to finance the early procurement of equipment for new reactors.
The government financing “is expected to accelerate deployment timelines by up to three years,” and to attract further investment in the nuclear supply chain, Mr. Teskey said.
“Our focus has now shifted from establishing the financing framework for long-lead orders to advancing individual projects,” he said.
Westinghouse’s main offering is its AP1000 reactor. There are two of these reactors operating in the U.S. and four in China, as well as more than a dozen others under construction. But the reactors also have a track record of construction delays and cost overruns, underscoring the inherent risk in such projects.
With a report from Reuters