Toshiba's Westinghouse to file for U.S. bankruptcy Tuesday: sources

Tue Mar 28, 2017 5:58pm EDT
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Kentaro Hamada and Taro Fuse

TOKYO (Reuters) - U.S. nuclear developer Westinghouse Electric Co plans to seek bankruptcy protection from creditors on Tuesday as it struggles to limit losses that have thrown its Japanese parent Toshiba Corp into crisis, people familiar with Toshiba's thinking said.

Pittsburgh-based Westinghouse, crippled by cost overruns at two U.S. power plant projects in Georgia and South Carolina, will file for protection under Chapter 11 of the U.S. Bankruptcy Code, the people told Reuters on Tuesday.

One of the sources has direct knowledge of the decision and one has been briefed on the matter.

Toshiba media representatives could not immediately be reached for comment after business hours. On Monday, the company said it was premature to comment on a potential bankruptcy. Westinghouse declined to comment.

A Westinghouse bankruptcy filing will help limit future losses for Toshiba.

The move will trigger complex negotiations between the Japanese conglomerate, its U.S. unit and creditors, and could embroil the U.S. and Japanese governments, given the scale of the collapse and U.S. government loan guarantees for new reactors.

A Westinghouse bankruptcy is a "concern" for the administration of U.S. President Donald Trump, which is in touch with the Japanese government on the matter, an administration official told Reuters on Tuesday.

"If several different things happen in a bad way, there’s a potential national security issue here," the official said.   Continued...

 
The Vogtle Unit 3 and 4 site, being constructed by primary contactor Westinghouse, a business unit of Toshiba, near Waynesboro, Georgia, U.S. is seen in an aerial photo taken February 2017.  Georgia Power/Handout via REUTERS