A cascade of gas centrifuges used to produce enriched uranium, similar to those used by Urenco

Government to sell stake in uranium enrichment firm

The Government hopes to raise up to £3bn by selling off its one-third stake in uranium enrichment company Urenco.

The UK, the Netherlands and a partnership between German utility companies RWE and E.On each own a third of the company, but the Government confirmed today it would go ahead with the planned sale as part part of a wider strategy to dispose of public assets such as Royal Mail and the Student Loan Book.

Urenco enriches uranium using gas centrifuges to provide fuel for nuclear power, with 50 customers across 18 countries representing a 31 per cent share of the global market.

Michael Fallon, the business and energy minister, said it was the right time for the Government to sell off its stake and that the decision made "good commercial sense", but that the transaction would have to meet Britain's security interests as well as represent value for money.

Any sale must be agreed with the Dutch and German governments, but RWE and E.On are also selling their stake and the Netherlands is also said to be considering a sale.

Officials said the proceeds would be used to "meet the Government's priorities of achieving strong and sustainable growth across the country".

Safeguards are to be put in place to ensure the new owners do not have access to sensitive information about nuclear technology, which would be retained by the state, and the Government will also seek to build in a requirement to be consulted as part of any future sale of the stake.

Potential buyers reportedly include Canadian energy firm Cameco, French nuclear group Areva, and Japan's Toshiba.

Mr 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 company was established in 1971 by a treaty between the UK, Dutch and German governments. A joint committee of the three nations supervises its operations, and the arrangement will remain in place following the sale.

Urenco has enrichment facilities at its UK base in Capenhurst in Cheshire, as well as in the Netherlands, Germany and New Mexico.

More details of the sale are expected to be released in the summer.

The Department for Business, Innovation and Skills said: "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."

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