GE, Toshiba form joint venture for power project
Tokyo, Japan (4E) – General Electric Co. and Toshiba Corp. opened talks for a possible joint venture to develop thermal power systems as they aim cash in from increasing demand for electricity generation.
Both companies have worked together on power-generation projects way back in 1982. The latest venture would expand their cooperation in combined-cycle power generation.
The Tokyo-based Toshiba, a company that manufactures PCs, power generators and televisions, plans to take a 50 per cent stake in the project with GE taking the other half. The deal is expected to be finalized by the end of the year, according to Toshiba spokesman Toru Ohara.
The venture will use gas and steam turbines, which are combined to produce power with lower carbon emissions and better fuel-efficiency compared with conventional thermal energy plants.
The announcement comes amid intensifying competition in the global energy market, as fast-growing economies like China and India push demand higher.
In November, Japanese firms Hitachi Ltd. and Mitsubishi Heavy Industries Ltd. have merged their businesses for a thermal power generation project. The planned Toshiba-GE venture will also rival that of Germany’s Siemens AG and France’s Alstom SA.
The two firms said the joint venture will create a company that will have annual sales of 1.1tn yen ($12.4bn). Toshiba’s stock price gained 1.9 per cent to 372 yen at Tokyo trading, the highest level since March 2012.