Brookfield’s Big Nuclear Bet – by David Fickling (Bloomberg News – January 4, 2018)

Is nuclear power dying out? The world’s second-biggest infrastructure investor just bet $4.6 billion that it’s not.

Westinghouse Electric Co., the slice of Toshiba Corp.’s bankrupt nuclear business focused on providing fuel and maintenance services to power stations, will be bought at that price by Brookfield Asset Management Inc.’s private equity arm Brookfield Business Partners LP, the company said Thursday.

Brookfield Business Partners likes to invest in unique, difficult businesses with high barriers to entry (palladium mining in Canada, for example, or graphite electrode manufacturing), making it hard to do direct valuation comparisons.

It’s also not entirely clear how much of the former Toshiba nuclear-service business it’s buying — about half of earnings has traditionally come from units not trading under the Westinghouse moniker.

Still, the deal comes at a multiple of 13.4 times the 38.7 billion yen ($343 million) of operating income from Toshiba’s overall nuclear fuel and servicing business in 2016, or 30 times the Westinghouse-branded segment of the total.

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