AGREEMENT SIGNED TO ACQUIRE AECL’S COMMERCIAL REACTOR DIVISION BY CANDU ENERGY
Approximately 1,200 employees are expected to be transitioned from AECL to CANDU Energy.
AECL is the Crown Corporation responsible for managing Canada’s nuclear energy research and development program. The commercial reactor division began developing the CANDU technology in the 1950s, and has built 34 reactors in seven countries. It has made a significant contribution to a key Canadian sector but in its current form, AECL was judged to be no longer sustainable. The privatization of AECL is an important turning point to allow for a new competitive business model, following years of challenges faced by AECL, and is an endeavour to keep alive the Canadian nuclear industry.
“This acquisition will require concerted and coordinated effort on the part of all stakeholders to work together. We will strive to make it a success both for the people who have built it, and for our shareholders,” said Patrick Lamarre, Executive Vice-President Global Power, SNC-Lavalin.
“The CANDU commercial reactor business will benefit greatly from SNC-Lavalin’s entrepreneurial capacity and global scale”, said the Honourable Joe Oliver, Minister of Natural Resources. “The transaction will place CANDU technology in proven, competent hands to be serviced and deployed in Canada and abroad, meeting energy needs and stimulating a supply chain located largely in Canada.”
The successful support and development of this technology is critical to sustaining Canada’s nuclear industry, which currently employs more than 30,000 workers in 150 companies across Canada. For CANDU Energy, the purchase of certain AECL assets means committing to preserving a homegrown, proven technology with good potential. CANDU Energy will focus on the new build, life extension and services product lines.
Lamarre continued, “Continuity and the quality of our services to the CANDU customer base are our top priorities going forward in Canada and internationally. With our expertise and experience in the nuclear sector, we believe that CANDU Energy will allow us to open new markets and capitalize on existing ones.”
CANDU Energy will work towards completing the Enhanced CANDU reactor (EC6) development program, with the support of the Government of Canada of up to $75 million. CANDU Energy will target new build projects in Ontario, Canada as well as in other countries around the world such as Jordan, Romania, Argentina, Turkey and China. The new company will also complete the remaining obligations under the ongoing life extension projects at Bruce Power, Wolsong, Point Lepreau and Gentilly-2 through subcontract service agreements with the Government of Canada.
The company will work hard to increase its share of the services business, on obtaining new life extension projects and additional scope on existing ones, and developing new build projects in order to build the CANDU Energy backlog.
The acquisition is expected to be finalized in early fall 2011, subject to the fulfillment of certain conditions including Competition Act compliance and other administrative approvals.
SNC-Lavalin is one of the leading engineering and construction groups in the world and a major player in the ownership of infrastructure, and in the provision of operations and maintenance services. SNC-Lavalin has offices across Canada and in over 35 other countries around the world, and is currently working in some 100 countries. In business since 1911, the Company celebrates its 100th anniversary in 2011.
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Media ContactLeslie Quinton
Senior Vice-President, Global Corporate Communications
SNC-Lavalin Group Inc.
Vice-President, Investor Relations
SNC-Lavalin Group Inc.