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Tuesday, December 23, 1997 Published at 06:19 GMT



Business

Merger creates nuclear giant
image: [ BNFL's Sellafield plant in Cumbria will play a key role in the new company ]
BNFL's Sellafield plant in Cumbria will play a key role in the new company

A nuclear power industry giant is being created with the merger of British Nuclear Fuels Limited and Magnox Electric.

But the merger, which has been two years in the making, is likely to cost hundreds of jobs.

The fuel reprocessing company, BNFL, employs 13,000 people and the power station operator, Magnox, has 3,700 employees.

Industry sources say the combined workforce could be reduced by up to 10% over time, on top of cuts already taking place in the industry.

The first stage of the merger, the transfer of the Government's shareholding in Magnox to BNFL, will take place early in the New Year, followed by full integration 12 months later.

The Industry, Energy and Science Minister John Battle said: "Safety will continue to be the companies' overriding concern. The merger will not change that.

"The merger will create an enlarged, integrated and strong BNFL able, for the first time, to manage all aspects of the Magnox business as a whole."

The deal will bring under one management the reprocessing currently carried out by BNFL for Magnox.

Under the terms of the agreement, the Government's liabilities for decommissioning the Magnox stations will be capped at £3.7 billion, down from £4.3 billion.

Mr Battle said: "The merger should accelerate the cost reduction and business improvement programmes which each of the companies has been separately pursuing."

Magnox is the fifth largest generator of electricity in England and Wales.

BNFL chairman John Guinness said: "This is a great boost to both companies and to the future of Magnox electricity generation."
 





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