As he announced, the president of EDF Jean Bernard Levy has sent this Friday to Areva executives Philippe Varin and Philippe Knoche, its proposal for the resumption of the activity of reactors Nuclear Group (Areva NP, formerly Framatome). Reportedly, this offer values the activities concerned just over € 2 billion, net of liabilities of the company. Specifically, the valuation is calculated on the basis of a multiple of 7.5 times EBITDA (EBITDA) activities occasions, recalculated according to the area concerned and restructurings that have been completed. “ This is an indicative offer, which must be followed by a period of due diligence before being adjusted to become a firm offer, possibly with conditions precedent ,” said a source close to the folder. “ At this point, the offer of EDF covers about a third of the financing needs of Areva, estimated at around 7 billion euros ,” continues the source.
During his public this week, Jean-Bernard Levy was very explicit. If the proposal EDF responds to a request of the State, its majority shareholder, it must also have a real industrial sense and focus on jobs controlled by the electrician. The area concerned and includes three activities: services to the installed base, the fuel assembly, and manufacturing equipment, employing 15,000 workers. EDF has even wished not to be affected by the risks associated with the past. For this contract on the Finnish EPR (OL3), which is subject to heavy losses and arbitration between Areva-Siemens and TVO, would be excluded from the offer. During a meeting with unions on Friday afternoon, Emmanuel Macron evoked thoughts around a guarantee that could be made by the State on OL3. EDF also hope that the uncertainties related to the damage on the tank of the Flamanville EPR, he raised a few weeks ago by the Nuclear Safety Authority, will be settled by the possible closing.
These activities would be housed in a separate structure with experienced leaders, which would be majority owned by EDF and the balance by external partners. “ EDF has already been approached by French companies interested in participating in round ,” says a source. In time, this structure is intended to be floated.
The offer of EDF also includes the engineering, design of reactors. The 1,200 engineers concerned would, themselves, integrated into EDF’s teams.
According to our information the electrician intends to finance its share of investment by adjusting its disposal program. It wants to maintain its objective of generating positive free cash flow after dividend payment in 2018.
While Areva leaders have so far not shown a big enthusiasm for this scenario, the economy minister Emmanuel Macron temporized on schedule this afternoon with unions. The state will make a decision “by the summer,” he said. A meeting on the future of Areva to be held at the Elysee Palace on June 3, but it will not be decisive.