AECL sale to SNC-Lavalin near
Ottawa is close to a sale of Atomic Energy of Canada Ltd. to SNC-Lavalin Group of Montreal, ending a federal withdrawal from the nuclear energy business that has been in the works since 2009.
The anticipated sale would include the Candu reactor business but not the Chalk River, Ont., nuclear reactor unit that makes medical isotopes and does research.
An announcement could come as early as this week, although final details are still being worked out.
Peter White, the head of the Society of Professional Engineers and Associates union that represents AECL workers, said he has not received word of any deal, but did say that management have asked for a meeting with union leaders on Wednesday.
"Somebody from AECL wants to talk tomorrow so that tells me something's going on," White said.
Requests for comment by AECL from CBC News were not immediately returned.
Engineering giant SNC-Lavalin is the sole remaining bidder in a process that saw Bruce Power walk away in January. SNC had been partnering with the OMERS pension plan, until the latter, too, stepped away from any deal in May.
AECL has had a troubled decade. The supply chain that supports it has been laying off workers, as sales and profits dwindled.
The Crown corporation ran up $800 million in red ink last year, and has not sold a new reactor since the 1990s. That's in part because there's reportedly a cap on new contracts while Ottawa mulls the sale, because the government doesn't want the company to be burdened with new liabilities.
But that's not to say the company is without value. Versant Partners analyst Neil Linsdell covers SNC-Lavalin, and he can see why the engineering giant would be interested.
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More than 70 per cent of SNC's core business comes from overseas, and they'd likely be looking to leverage that expertise into more contracts for the company's CANDU reactors.
AECL is struggling to modernize its technology to keep up with rivals Areva, Westinghouse, Hitachi and others. But there's a market for the existing reliable CANDU technology in the developing world, Linsdell said.
"SNC is really a great partner for [Ottawa] because of their international expertise in working with emerging economies," he said.
Even excluding any new sales, the servicing side of AECL's reactor business is profitable, Linsdell said. "The service business is going to be a good one," he said. "SNC is going to get a good deal out of this thing."
For its part, the union hopes that any move for privatization won't result in the company being chopped up and sold off piecemeal.
"The real concern is that the new buyer might not want to take over all the [components]," White said. "It's hard to maintain a nuclear industry with just one piece."
"The government has starved us so we're not as attractive, and that makes the price go down," White said.
But even if they get a good deal on paper, SNC is likely to invest far more in the company than the initial price tag, some say. The purpose of the privatization may not be to acquire funds, Mount Royal University public policy professor Duane Bratt said Tuesday. Rather, the appeal for Ottawa would be to stop the bleeding of more parliamentary appropriations after a slow sale process, he said.