June 1, 2010 / 5:23 AM / 10 years ago

UPDATE 3-Hitachi reviews nuclear power partnership with GE

* Hitachi looks at ways to boost global sales

* May recast nuclear power JV ownership structure

* Foreign sales not going as hoped -Nikkei

* Europe woes delay some contracts -FT quoting president

* GE says have been no discussions on changing venture (Adds GE response, paragraphs 3-4)

TOKYO, June 1 (Reuters) - Hitachi Ltd (6501.T), Japan’s largest electronics maker, said on Tuesday that it is reviewing the structure of its nuclear power partnership with General Electric Co (GE.N), as it seeks to win more deals globally.

A Hitachi spokesman did not rule out the possibility of Hitachi and GE changing their investments in their joint ventures as part of an overhaul of Hitachi’s global sales network, but said nothing concrete had been discussed or decided.

The largest U.S. conglomerate said on Tuesday it had held no talks with Hitachi about changing the venture.

“We have not had any discussions with Hitachi about changing our alliance structure,” said GE spokesman Daniel Nelson. “We value our alliance and look forward to continuing to work together to respond to our customers’ needs worldwide.”

The nuclear power business is one of the focus areas for Hitachi — a sprawling conglomerate of 900 group firms — as it steers itself towards growth again after four consecutive years of losses. [ID:nTOE64U027]

It competes with the likes of Japan’s Toshiba (6502.T) and France’s Areva CEPFi.PA in nuclear power.

The Nikkei business daily reported earlier that Hitachi is considering taking control of foreign sales of nuclear equipment. Hitachi currently leads Japan sales, while GE is in charge of other markets through their partnership.

“GE has its hands full with the U.S. and isn’t able to cover Asia, the Middle East and Europe,” Hitachi President Hiroaki Nakanishi was quoted as telling the Nikkei in an interview.

Nakanishi also told the paper that he thought the foreign operations were not working out as Hitachi had initially expected.

But J.P. Morgan analyst Yoshiharu Izumi questioned whether it would make much difference if Hitachi took charge of its overseas nuclear sales.

“GE and Hitachi make BWRs (boiling water reactors), and they don’t do PWRs (pressurized water reactors), which is growing and which Toshiba, Westinghouse and Areva offer,” Izumi said.

“The main markets for the BWR-type reactors are still the United States and Japan. So I don’t think there will be much difference even if Hitachi takes control.”

In the nuclear segment, it and GE joined forces in 2007 and set up joint ventures in Japan and the United States.

Hitachi owns 80 percent of the Japanese venture, while GE as a 60 percent stake in the American company, which caters to the United States and other overseas markets.

The Nikkei also said Hitachi will consider locating its headquarters for some business segments, including information technology and infrastructure, overseas. It has already moved the headquarters of its hard-disk-drive segment to the United States.

Separately, The Financial Times quoted Nakanishi as saying in an interview that Europe’s debt problems were having an impact on business and that some contracts had been delayed and there may be cancellations.

But the Hitachi spokesman said that while some projects were experiencing some delays, the company was not expecting any cancellations or a big impact on overall earnings. (Reporting by Koustav Samanta in BANGALORE and Sachi Izumi in TOKYO, additional reporting by Scott Malone in BOSTON; Editing by Maju Samuel, Chris Gallagher and Matthew Lewis)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below