Westinghouse auction set to raise $2.6bn

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The Independent Online

The price for Westinghouse, the US-based nuclear engineering company which has been put up for sale by its owner, British Nuclear Fuels, has risen to about $2.6bn (£1.5bn) as the final week approaches before bidders must table formal offers.

General Electric and Shaw of the US, Japan's Toshiba and Mitsubishi Heavy Industries, and Doosan Heavy Industries, based in Korea, are still in the running. They must submit offers by 19 December. Rothschild, the investment bank handling the sale for BNFL, which is owned by the UK Government, will whittle down the group to two finalists by about 10 January and a decision on a winner could be made as early as February.

There has been intense competition for the Pittsburgh-based Westinghouse, one of the world's largest providers of nuclear technology and one of the main contenders to win a multibillion-dollar contract to build new reactors in China.

The price has risen from an initial valuation of about $1bn to $2.6bn. The higher price reflects the fact that the buyer will take on about $600m of Westinghouse's historic nuclear clean-up liabilities, which the British Government is keen to remove from its own books.

In the US, the sale of one of its largest nuclear companies is causing concern among politicians, who are opposed to its cutting-edge nuclear technology passing to a non-US owner. Sources close to the situation said the sale would likely trigger hearings on Capitol Hill.

The Westinghouse deal would probably also be referred to CFIUS, the White House-controlled committee that regulates foreign investments in US companies.