Exxon Corp. Selling Exxon Nuclear Co. to West German Firm
Dec. 23, 1986
NEW YORK (AP) _ Petroleum giant Exxon Corp. has agreed to sell its Exxon Nuclear Corp. subsidiary to the West German firm, Kraftwerk Union AG, the companies announced today.
It was the third major asset sale announced this month by the world's largest oil company.
Exxon spokeswoman Juliet McGhie declined to reveal the amount of the sale. It was expected to be finalized in late December.
Exxon Nuclear Co., founded by its parent company in 1969, designs, manufactures and markets pressurized and boiling water reactor fuels and provides related services for electrical utilities in the United States, Europe and the Far East.
The company has headquarters in Bellevue, Wash. with plants in Richland, Wash. and Lingen, West Germany. The Lingen plant is owned and operated by Exxon Nuclear's German subsidiary.
Under the agreement, Kraftwerk Union will acquire all the common stock of Exxon Nuclear. Exxon will hold a small non-voting preferred stock position in Exxon Nuclear for a limited period of time.
Kraftwerk Union, a wholly owned affiliate of Siemens AG and based in Muelheim, West Germany, supplies fuels and services for fossil fuel and nuclear power plants. It operates worldwide, but primarily outside the United States.
In recent weeks Exxon has announced sales of its interest in the Exxon Building in New York and its Reliance Electric Co.
An oil industry analyst said Exxon is trying to redirect its resources, and wants to do so before the end of 1986 and the effective date of the federal tax overhaul.
''It's very clear that Exxon is tidying up and trying to do these things before the year's end,'' said Sanford Margoshes, an oil industry analyst with Shearson Lehman Brothers Inc.
The sale of Exxon Nuclear is ''a demonstration that Exxon wants to confine itself more for the moment to its fundamental business, research for and development of oil and gas,'' Margoshes said.
He said the company remains healthy, and is not selling off its assets to raise cash.
Exxon, the world's largest oil company, earned $4.87 billion on revenue of $92.87 billion in 1985.