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Mitsubishi Heavy Industries and Japan Nuclear Fuel have agreed to invest €500m in a new atomic fuel company that is being spun off from France’s Areva as part of a government-backed bailout agreed last year.

MHI said on Friday it would pay €250m for a 5 per cent of the so-called NewCo, which is set to house the nuclear-fuel operations of Areva. Japan Nuclear Fuel said it was also investing €250m, highlighting their commitment to nuclear fuel even after Fukushima.

Areva has for the last year been preparing to split off its uranium mining and nuclear fuel activities following a French government-backed rescue deal after the group was forced to the brink of collapse under the weight of its own debt.

Last year it was agreed that the other half of Areva – the troubled reactor business, or OldCo – would be taken over by EDF, the larger French nuclear group, in a deal that values that part of the business at about €2.5bn.

Areva said in December that it had received a firm €500m offer for a 10 per cent stake in a new nuclear fuel company. The FT reported at the time that Mitsubishi Heavy Industries and Japan Nuclear Fuel were involved.

Copyright The Financial Times Limited 2017. All rights reserved.

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