Shares of Toshiba Corp. rose after a Nikkei report said the company beat General Electric Co. and Hitachi Ltd. to win a 600 billion yen ($4.9 billion) contract to supply nuclear plant equipment to NRG Energy Inc.
Toshiba, Japan's biggest maker of nuclear power reactors by capacity, gained 1.2 percent to 1,036 yen as of 10:56 a.m. on the Tokyo Stock Exchange. Toshiba Plant Systems & Services Corp., its power construction unit, rose 6.6 percent to 1,033 yen.
NRG Energy chose to use Toshiba reactors after reviewing the company's proposal, the Nikkei reported, without saying where it got the information. NRG's Houston, Texas-based spokesman David Knox declined to comment on the report. Tokyo-based Toshiba spokesman Keisuke Ohmori said both parties are still in talks, declining to give details of the project.
The victory would help Toshiba recover a $4.16 billion investment of nuclear plant maker Westinghouse Electric Co. and reduce its reliance on semiconductors. Toshiba, which gets more than half of its operating profit from chips, plans to more than triple sales in its nuclear plant business by 2015 on growth in demand in the U.S. and China.
Princeton, New Jersey-based NRG Energy in June last year announced plans for the two 1.35 million-kilowatt boiling-water reactors near Houston, using equipment built by GE and Hitachi. The company said at the time the plants would cost $5.2 billion, and may begin operations as soon as 2014.
Hitachi spokeswoman Machiko Ikenoya said the company is not aware of any changes in NRG's intention to use its equipment and is still in talks with the power producer.
Annual sales at Toshiba's nuclear construction, maintenance and fuel businesses will probably rise to about 700 billion yen in 2015, from about 200 billion yen in the year ended March 2006, the company said in October.
source:bloomberg.com
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