France´s Areva unveils plan for nuclear fuel unit

PARIS: Struggling French nuclear giant Areva said Wednesday it will create a new nuclear fuel subsidiary as it withdraws from the business of building reactors.

Areva, 87-percent owned by the French state, is restructuring after being hit by a slump in demand for nuclear power.

The group, which announced a fifth straight year of losses last year, is finalising the takeover of its reactor arm by state-backed electricity utility EDF.

To shore up Areva´s accounts, which carried a debt of more than six billion euros last year, the group announced earlier this year plans for a 5-billion-euro ($5.4 billion) capital injection in 2017, in which the French state is taking part.

Areva and its newly created nuclear fuel unit, provisionally called New Co, will jointly benefit from the cash injection, the group said.

"By means of the solutions it can provide for uranium supply, for its conversion into fuel and for nuclear fuel recycling, waste management and dismantling, New Co. will be in a good position to grow in global nuclear markets," Areva chief executive Philippe Knoche said in the statement.

Following the shakeup, the French state will hold at least 67 percent in the new company, it said.