Candu to buy AECL unit for $15.6M

Candu Energy, a wholly owned subsidiary of SNC-Lavalin Group, has agreed with the Government of Canada to acquire certain assets of Atomic Energy of Canada’s (AECL) commercial reactor division for a purchase price of CAD15 million (USD $15.59 million) and royalty payments from future new build and life extension projects. AECL will retain its past liabilities.

Approximately 1,200 employees are expected to be transitioned from AECL to Candu. AECL is 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.

The Canadian government determined that AECL was no longer sustainable. The privatization of AECL is a turning point to allow for a new competitive business model, following years of challenges faced by AECL, and is an endeavor to keep alive the Canadian nuclear industry, according to the Montreal-based SNC-Lavalin. Canada’s nuclear industry currently employs more than 30,000 workers in 150 companies.

Candu will focus on the new build, life extension and services product lines.

Candu said it will work toward completing the Enhanced Candu reactor (EC6) development program, with the support of the Government of Canada of up to $75 million. Candu 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 acquisition is expected to be finalized in early fall, subject to the fulfillment of certain conditions including Competition Act compliance and other administrative approvals.