VIDEO: France to merge Areva, EDF nuclear reactor businesses
French President Francois Hollande's office announced the deal's broad outlines
PARIS (AP) — French nuclear giants Areva and EDF will merge their reactor businesses in a joint venture controlled by EDF — a wide-ranging reshuffle of the country's state-owned nuclear energy industry.
French President Francois Hollande's office announced the deal's broad outlines Wednesday, saying final details would be negotiated by the two companies within a month.
The French government, which controls over 80 percent of both companies, will inject new capital "of the necessary amount" in Areva as part of the deal.
The outcome is a major reversal for Areva, whose ex-CEO Anne Lauvergeon fought off attempts to marry her company and EDF for years.
Areva lost nearly $5.6 billion last year after taking a massive loss on new nuclear reactor projects in France and Finland.
Both companies are run by CEOs who've been at the helm for less than a year — Areva by Philippe Knoche and EDF by Jean-Bernard Levy. Late last year Areva chairman Philippe Varin also took a board seat at EDF in a move widely seen as paving the way for closer ties between the long-time atomic rivals.
Last month Areva announced a 1-billion-euro cost-cutting plan, which included the removal of up to 6,000 jobs.
Only five years ago Areva was seen as a French success story, led by swashbuckling CEO Lauvergeon as it rode the wave of the so-called "nuclear renaissance."
The company's fortunes collapsed after a series of failures, including massive cost-overruns and technical failings with its new generation reactor; a disastrous investment in a Nigerien uranium mine; and the aftereffects of a global rejection of nuclear power after Japan's Fukushima reactor meltdown.