Business and Energy Minister Michael Fallon today announced that the government is proceeding with plans to sell some or all of its one-third shareholding in the uranium enrichment company Urenco.
The decision to proceed with preparations for a sale comes after the government has secured agreement to do this from its Dutch and German partners. Any final decision to sell will require the support of both the Dutch and German Governments and shareholders.
Building on work over a number of years, the sale supports the government’s strategy to dispose of public assets that do not require public ownership. Funds released from a sale can then be used to meet the government’s priorities of achieving strong and sustainable growth across the country.
Any sale will only be concluded if the government is satisfied that the UK’s security and non-proliferation interests can be protected and that value for money is achieved for the UK taxpayer.
Business and Energy Minister Michael Fallon said:
Urenco is a world leading, high technology company with strong earnings and the time is right for government to sell its stake. It makes good commercial sense now and is consistent with our position that assets should be sold where ownership itself does not deliver any policy objective.
Our priority is to ensure taxpayers’ money is being used in the most effective way to boost economic growth. Any sale will make sure we deliver value for money and protect the UK’s security and non-proliferation interests.
The government is committed to putting the UK at the forefront of the race to capture the benefits of the domestic and global nuclear market. The decision to sell the stake is part of our wider strategy to realise the best value for government shareholdings of assets including the Student Loan Book and Royal Mail.
The Dutch government owns a third of Urenco and the German utility companies RWE and E.on jointly own the remaining third. Any change in ownership must be agreed by all shareholders and with the German government.
The form, scale and timing of any proposed sale has not yet been determined and will be conditional upon further discussions. Further announcements will be made in due course.
Notes to editors
Urenco enriches uranium using gas centrifuges to provide fuel for nuclear power utilities and provides uranium enrichment for around 50 customers across 18 countries - approximately 31 per cent of global market share.
Urenco was established in 1971 following the Treaty of Almelo signed by the governments of Germany, the Netherlands and the UK and was incorporated as an English private limited liability company.
The Treaty of Almelo provides for effective supervision of Urenco’s technology, manufacturing and enrichment operations (which are of nuclear proliferation or security concern) through a Joint Committee comprised of representatives of the three governments. These arrangements will remain in place.
In January 2013 policy and ownership responsibility for Urenco moved from DECC to BIS to consolidate government shareholdings within the Shareholder Executive.
Urenco is a global business providing uranium enrichment services across the globe through its enrichment facilities in the Capenhurst (UK), Almelo (Netherlands), Gronau (Germany) and New Mexico (US).
The UK is being advised by Morgan Stanley on the sale process and will be co-ordinating all activity with the Dutch and German shareholders. More details of the sale are expected to be available this summer.
The government’s economic policy objective is to achieve ‘strong, sustainable and balanced growth that is more evenly shared across the country and between industries.’ It set four ambitions in the ‘Plan for Growth’ (PDF 1.7MB), published at Budget 2011:
- To create the most competitive tax system in the G20
- To make the UK the best place in Europe to start, finance and grow a business
- To encourage investment and exports as a route to a more balanced economy
- To create a more educated workforce that is the most flexible in Europe.
Work is underway across government to achieve these ambitions, including progress on more than 250 measures as part of the Growth Review. Developing an Industrial Strategy gives new impetus to this work by providing businesses, investors and the public with more clarity about the long-term direction in which the government wants the economy to travel.