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Monday, August 20, 2012

Call to limit China's UK nuclear stake

(Financial Times) -- Chinese companies competing for one of the UK's biggest nuclear projects are unlikely to end up with a majority stake in any winning consortium in an attempt to allay concerns about Beijing gaining control of the Horizon reactor programme.

Chinese nuclear companies have joined groups hoping to take ownership of the project, which was put up for sale earlier this year by its current joint owners, German utilities Eon and RWE. The deal represents a big test for large-scale Chinese investment in UK infrastructure projects given the sensitivities surrounding the nuclear industry.

Several people familiar with the sale process said UK officials had signalled a preference for the two competing consortiums' Chinese partners to be minority investors in the project. Restricting their stakes could be difficult, however, particularly as the billions of pounds in funding needed to build the plant will most probably come from Chinese-backed lenders.

"It has always been understood that the Chinese could not have more than 50 per cent, for reasons of public acceptance and political acceptance," said one person familiar with deliberations at the UK energy department. Read More