Ahead of Nuclear Investment, S. Korea and US Tug-of-War Over Westinghouse Stake

It has been learned that the South Korean government and the United States are continuing negotiations over the acquisition of a stake in US nuclear company Westinghouse.

Previously, plans were discussed for the South Korean side to secure a stake of 15% or more in Westinghouse, but the US side is reportedly offering a lower level of 5 to 10%.

According to political circles and government authorities today (September 16), the Ministry of Trade, Industry and Energy recently mentioned details regarding the Westinghouse stake acquisition during a report to the National Assembly.

The government and Korea Electric Power Corporation have been proposed by the US side to invest in a stake in Westinghouse and have been reviewing investment structures and financing methods.

Currently, the shares of Westinghouse are held 51% by Canadian private equity firm Brookfield and 49% by uranium company Cameco.

The government is known to be seeking to maximize South Korea's stance as Westinghouse pursues nuclear power projects through equity investment.

There are also opinions that South Korea must secure a 15% stake in Westinghouse to increase its investment practical gains.

Expectations are raised that participating in the board of directors and having a voice in major decision-making processes would expand opportunities for domestic companies to participate in projects such as construction, while also broadening the scope of maneuver when negotiating export control and intellectual property issues with Westinghouse.

Korea Hydro & Nuclear Power and Korea Electric Power Corporation signed a 50-year long-term agreement with Westinghouse in January of last year, which requires providing over 1 trillion won in royalties and procurement services for every nuclear reactor exported, while effectively abandoning independent entry into advanced markets such as Europe.

The US side also needs equity investment from South Korea, which possesses nuclear power construction capabilities.

As Westinghouse pursues an initial public offering, the joining of South Korea, which has world-class nuclear power construction capabilities, can act favorably for the rise in corporate value.

However, it is unlikely that the US side would welcome South Korea's entry into the board of directors.

Inside and outside the South Korean government, observations are emerging that Westinghouse will not allow management involvement by the South Korean side, which is a competitor in the nuclear power market.

The Ministry of Trade, Industry and Energy explained, "We are holding various discussions regarding nuclear power projects for investment in the US between South Korea and the US, but specific details including the acquisition of a Westinghouse stake have not yet been decided."

Continuing final coordination with the US on investment projects in the US, the Ministry of Trade, Industry and Energy plans to report the first project and detailed particulars to the National Assembly as early as September 17 and finally sign a memorandum of understanding on September 18.

Minister of Trade, Industry and Energy Kim Jung-gwan, who conducted negotiations in the US for three days starting from September 10 with US Secretary of Commerce Howard Lutnick and others, explained, "It is true that we are close to agreement on many issues, but issues remain until the final signature is made. It is not over until the signature is signed."

The project is expected to include the construction of the Encinal gas-combined cycle power plant in Texas and the construction project for eight large-scale nuclear reactors in the US.

In the case of the Alaska liquefied natural gas project, which is mentioned as another candidate, evaluations suggest it is difficult to secure commercial rationality, so rather than confirming investment right away, an agreement at the level of reviewing it as an "investment target" is projected to be included.
※ Please note: This article was translated by AI and may contain errors.