AGREEMENT SIGNED TO ACQUIRE AECL'S COMMERCIAL REACTOR DIVISION BY CANDU ENERGY
30 June 2011 - 6:47AM
PR Newswire (Canada)
TORONTO, June 29, 2011 /CNW/ -- TORONTO, June 29, 2011 /CNW Telbec/
- CANDU Energy, a wholly-owned subsidiary of SNC-Lavalin Group Inc.
(TSX: SNC), is pleased to announce that it has agreed with the
Government of Canada to acquire certain assets of Atomic Energy of
Canada's (AECL) commercial reactor division for a purchase price of
$15 million and royalty payments from future new build and life
extension projects. AECL will retain its past liabilities.
Approximately 1,200 employees are expected to be transitioned from
AECL to CANDU Energy. AECL is the Crown Corporation responsible for
managing Canada's nuclear energy research and development program.
The commercial reactor division began developing the CANDU
technology in the 1950s, and has built 34 reactors in seven
countries. It has made a significant contribution to a key
Canadian sector but in its current form, AECL was judged to be no
longer sustainable. The privatization of AECL is an important
turning point to allow for a new competitive business model,
following years of challenges faced by AECL, and is an endeavour to
keep alive the Canadian nuclear industry. "This acquisition
will require concerted and coordinated effort on the part of all
stakeholders to work together. We will strive to make it a success
both for the people who have built it, and for our shareholders,"
said Patrick Lamarre, Executive Vice-President Global Power,
SNC-Lavalin. "The CANDU commercial reactor business will benefit
greatly from SNC-Lavalin's entrepreneurial capacity and global
scale", said the Honourable Joe Oliver, Minister of Natural
Resources. "The transaction will place CANDU technology in proven,
competent hands to be serviced and deployed in Canada and abroad,
meeting energy needs and stimulating a supply chain located largely
in Canada." The successful support and development of this
technology is critical to sustaining Canada's nuclear industry,
which currently employs more than 30,000 workers in 150 companies
across Canada. For CANDU Energy, the purchase of certain AECL
assets means committing to preserving a homegrown, proven
technology with good potential. CANDU Energy will focus on the new
build, life extension and services product lines. Lamarre
continued, "Continuity and the quality of our services to the CANDU
customer base are our top priorities going forward in Canada and
internationally. With our expertise and experience in the nuclear
sector, we believe that CANDU Energy will allow us to open new
markets and capitalize on existing ones." CANDU Energy will work
towards completing the Enhanced CANDU reactor (EC6) development
program, with the support of the Government of Canada of up to $75
million. CANDU Energy will target new build projects in
Ontario, Canada as well as in other countries around the world such
as Jordan, Romania, Argentina, Turkey and China. The new company
will also complete the remaining obligations under the ongoing life
extension projects at Bruce Power, Wolsong, Point Lepreau and
Gentilly-2 through subcontract service agreements with the
Government of Canada. The company will work hard to increase its
share of the services business, on obtaining new life extension
projects and additional scope on existing ones, and developing new
build projects in order to build the CANDU Energy backlog. The
acquisition is expected to be finalized in early fall 2011, subject
to the fulfillment of certain conditions including Competition Act
compliance and other administrative approvals. SNC-Lavalin is one
of the leading engineering and construction groups in the world and
a major player in the ownership of infrastructure, and in the
provision of operations and maintenance services. SNC-Lavalin has
offices across Canada and in over 35 other countries around the
world, and is currently working in some 100 countries. In business
since 1911, the Company celebrates its 100(th) anniversary in 2011.
www.snclavalin.com. To view this news release in HTML
formatting, please use the following URL:
http://www.cnw.ca/en/releases/archive/June2011/29/c2353.html table
class="cnwBorderedTable" border="1" cellspacing="0" valign="top" tr
valign="top" td align="left" Media: /td td align="left"
valign="top" Investors: /td /tr tr valign="top" td align="left"
Leslie Quintonbr/ Vice-President, Global Corporate
Communicationsbr/ SNC-Lavalin Group Inc.br/ 514-393-8000, ext.
7354br/ a
href="mailto:leslie.quinton@snclavalin.com"leslie.quinton@snclavalin.com/a
/td td align="left" valign="top" Denis Jasminbr/ Vice-President,
Investor Relationsbr/ SNC-Lavalin Group Inc.br/ 514-393-8000, ext.
7553br/ a href="http://denis.jasmin@snclavalin.com"denis.jasmin/aa
href="mailto:denis.jasmin@snclavalin.com"@snclavalin.com/a /td /tr
/table p /p
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