AREVA to raise $5.63 billion and spin off nuclear fuel cycle company

Written By: Stratton Report
June 15, 2016


On June 15, AREVA confirmed its plan to restructure the group and to create a separate entity refocused on the nuclear fuel cycle, currently named NEW CO according to the firm.
Philippe Knoche, Chief Executive Officer, remarked:

“Today, we present the roadmap for AREVA’s continued transformation. This program defines the major stages necessary to the creation of NEW CO, a separate new entity refocused on the Mining, Front End and Back End operations. Pursuant to strategic choices concerning the nuclear industry, the roadmap specifies the conditions for the transfer of AREVA’s reactor-related operations to EDF and the refocusing of our group on fuel cycle management.”

According to the firm, AREVA and NEW CO will each benefit from a capital increase in the combined amount of 5 billion euros ($5.63 billion) and will have resources suited to their mission and their strategy.
During the second half of 2016, AREVA intends to contribute the assets of the AREVA Mines, AREVA NC, AREVA Projects and AREVA Business Support companies and their respective subsidiaries to NEW CO, as well as part of AREVA SA’s debt.  The subsidiaries AREVA TA, AREVA Energies Renouvelables and AREVA NP would continue to be held by AREVA SA until the date of their sale.
At the beginning of 2017, AREVA plans to raise 5 billion euros ($5.63 billion). According to the firm, the French government has announced that it will participate as leading shareholder and ensure success in raising the capital in compliance with European regulations. The new capital will be divided between money raised for AREVA SA, which the French government would provide; and money raised for NEW CO, to which the French government and strategic investors would provide. Following this transaction, the French government would hold a minimum of two thirds of NEW CO’s capital, with the balance held by strategic investors.
As part of the finalization of transactions pertaining to the redefinition of AREVA SA’s scope, the French State will ensure that minority shareholders’ rights are upheld, pursuant to stock exchange regulations.
During 2017 AREVA NP’s operations would be sold to EDF with the exception of the OL3 contract.  Between 15% and 25% proceeds of the sale of AREVA NP’s operations to EDF will be transferred by AREVA SA to NEW CO.
The newly created and capitalized NEW CO, refocused on less risky cash flow-generating operations, hopes to be in a position to refinance on markets in 2019-2020.