Westinghouse, an electric company owned by Toshiba Corp (USA) (OTCMKTS:TOSYY), has filed for bankruptcy.
Here are a few things to know about the Westinghouse bankruptcy.
- Westinghouse is filing bankruptcy due to the high cost of building four nuclear power plants.
- The cost of building the plants has grown higher than the company originally planned.
- It plans to use the bankruptcy to determine if it can continue construction of the nuclear power plants.
- Westinghouse also says that it plans to try and “isolate” itself from the parts of it business that is losing money.
- This includes the construction of nuclear power plants in Georgia and South Carolina.
- The company also points out that its servicing of nuclear power plant and nuclear fuel businesses are incredibly profitable.
- It also notes that it has obtained $800 million in financing to keep it operating while it undergoes restructuring during its bankruptcy.
- Satoshi Tsunakawa, the CEO of Toshiba Corp, said that a Chapter 11 bankruptcy filing is “essential” to the restructuring of Westinghouse.
- Toshiba Corp also notes that the Westinghouse bankruptcy will allow it to limit the negative effects the company has on it.
- This includes removing the company’s financial details from its own earnings reports.
- The plan will also make it so that the power company is no longer under Toshiba Corp’s control.
You can follow these links to learn more about the Westinghouse bankruptcy.
TOSYY stock was down 1% as of Wednesday afternoon, and is down 22% year-to-date.