In a transaction expected to close by the end of 2009, FTSE-250 firm Babcock will take full control of UKAEA Ltd, a wholly-owned subsidiary of the Atomic Energy Authority.
Established in April 2008, UKAEA holds contracts for decommissioning work at three UK nuclear sites, including at Dounreay in Caithness.
It also offers consultancy services in international markets.
Business secretary Lord Mandelson announced plans to sell UKAEA in March, sparking Conservative warnings the sale stemmed from a “short-term cash crisis”.
But Lord Mandelson insisted yesterday the deal represented “good value for the taxpayer”, and was good news for UKAEA and its staff.
“The sale will allow the company, as part of Babcock International, to continue its development and take advantage of new opportunities in the nuclear industry,” he said.
Based in London, Babcock has been involved in nuclear energy since the 1960s. It is also active in the rail and defence industries, and provides support services for Faslane Naval Base on the Clyde river. Its purchase of UKAEA follows the acquisitions of nuclear services operator Alstec in 2006, and International Nuclear Solutions in 2007.
Babcock chief executive Peter Rogers said: “We’re probably the biggest player in the decommissioning market already, but we have every intention of growing our nuclear division at a fair clip.”
Jobs at UKAEA sites such as Dounreay would be secure, he added.
“There are not that many nuclear engineers and nuclear scientists around in the UK. We employ about 5,500 people in Scotland; it can only be good for the country to have someone as committed to Scotland as we are owning the site at Dounreay.”
Shore Capital analyst Robin Speakman said he expected Babcock’s revenues to rise by £35m in the first full year following the purchase.
“UKAEA is likely to ultimately lead to a doubling of Babcock’s civil nuclear engineering resources,” he said.
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