FRANKFURT/LONDON, Dec 4 (Reuters) - A stock market listing is the preferred option for Urenco, the uranium enrichment company that co-owners Britain, the Netherlands and Germany are trying to sell, according to three sources familiar with the matter.
The owners are also still pursuing an auction for the asset, the sources told Reuters, but added the focus had shifted to an initial public offering (IPO), even though such a step may only materialise after a general election in Britain in May next year.
“They (the British government) don’t want to have another second-class IPO like Royal Mail before the election,” one of the sources said, speaking on condition of anonymity.
The British government sold a 60 percent stake in the state postal operator last year, but it was accused by opposition politicians and trade unions of selling it off too cheaply after the stock soared by as much as 87 percent.
Urenco, the world’s second-largest nuclear fuel vendor after Russia’s Tenex, could fetch up to 10 billion euros ($12.31 billion), but the complex ownership structure makes both a sale and an IPO difficult, separate sources have said.
Its owners, which include German utilities E.ON and RWE on behalf of the German government, want to raise money from asset sales but they also have a duty to ensure secret technology, which could be used to make an nuclear bomb, does not fall into the wrong hands.
E.ON and RWE declined to comment on Thursday.
The British government’s business department had no immediate comment, while a spokesman for the Dutch government could not be immediately reached for comment.
Sources said in October that the governments, which each own a third of Urenco, had asked prospective buyers to submit indicative bids for Urenco by the end of the year.
However on Thursday, one of the sources familiar with the matter said that some of the parties interested were struggling to come up with the money, pointing to France’s Areva , which in November issued its third profit warning in four months.
He added that other potential bidders had issues of their own, which could result in a subdued interest on their part.
Buyers would have to be approved by all three owners, as stipulated by the Almelo treaty between Germany, Britain and the Netherlands that regulates the use of uranium enrichment for civil purposes.
$1 = 0.8123 euro Additional reporting by Christoph Steitz in Frankfurt, Pamela Barbaglia, Anjuli Davies and William James in London, Geert de Clercq in Paris and Anthony Deutsch in Amsterdam; Editing by Pravin Char