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Highlights
Brookfield agrees to sell Westinghouse Electric Company amid rise in interest in nuclear power sector.
Westinghouse will be sold for an estimated US$8 billion to Cameco Corporation and Brookfield Renewable Partners.
Brookfield had acquired Westinghouse out of bankruptcy in 2018.
American clean energy investor Brookfield Business Partners (NYSE: BBUC, BBU; TSX: BBUC, BBU.UN) has announced to sell its nuclear technology services operation, Westinghouse Electric Company. The acquisition agreement is being carried on collaboratively with its institutional partners, collectively known as Brookfield.
According to the official release, Westinghouse will be sold to a strategic consortium that is headed by Cameco Corporation and Brookfield Renewable Partners for an estimated US$8 billion in total enterprise value. This would include proceeds from the disposition of a non-core asset that is expected to be received before the transaction closes.
The transaction's completion would be contingent on several factors, including Brookfield Business Partners’ unitholder approval, governmental approvals, and several other customary conditions. The transaction is anticipated to be closed in the second half of 2023.
What did Brookfield’s management say?
The release further stated that Westinghouse stands as one of the global providers of mission-critical technologies, services, and products to the nuclear power sector. Back in 2018, when Westinghouse was struggling with bankruptcy, Brookfield bought the company.
Details of the acquisition
This transaction was examined by the Governance and Nominative Committee of Brookfield Business Partners’ general partner, which is made up of independent directors. Meanwhile, RBC Capital Markets, BMO Capital Markets, and Weil, Gotshal & Manges LLP are serving as Brookfield's financial and legal advisors, respectively. The independent committee is being financially advised by TPH & CO., the energy division of Perella Weinberg Partners, and legally counselled by Stikeman Elliott LLP.
As per the company’s announcement, the estimated revenues for Brookfield would be equivalent to around six times its invested capital, a 60% IRR, and a total profit of US$4.5 billion when combined with distributions already received. Additionally, with the sale of its 44% stake in Westinghouse, Brookfield Business Partners anticipates receiving around US$1.8 billion in cash, with the remaining amount going to its institutional investors.
