ML18086B506
| ML18086B506 | |
| Person / Time | |
|---|---|
| Site: | 07000036, Westinghouse |
| Issue date: | 03/21/2018 |
| From: | Sweeney M Westinghouse |
| To: | Document Control Desk, Office of Nuclear Material Safety and Safeguards |
| Shared Package | |
| ML18086B504 | List: |
| References | |
| Download: ML18086B506 (5) | |
Text
Westinghouse Non-Proprietary Class 3 Michael T. Sweeney Senior Vice President and General Counsel Westinghouse Electric Company 1000 Westinghouse Drive Cranberry Township, PA 16066 USA March 21, 2018 10 CFR 70.36 10 CFR 110.50 & 110.51 SNM-33 SNM-1107 Via Electronic Information Exchange ATTN: Document Control Desk U.S. Nuclear Regulatory Commission One White Flint North 11555 Rockville Pike Rockville, MD 20852 Direct tel: (412) 374-4526 Mobile: (412) 251-1469 e-mail: sweenemt@westinghouse.com Re:
Application for Consent to Indirect Change of Control with Respect to Materials Licenses and Export Licenses and Notification Regarding Quality Assurance Program Approvals, Certificates of Compliance, and Design Certification
Dear Sir or Madam:
Enclosed for filing with the U.S. Nuclear Regulatory Commission (NRC) is an Application by Westinghouse Electric Company LLC (Westinghouse) for Consent to an Indirect Change of Control with respect to the materials licenses and export licenses held by Westinghouse listed on Exhibit B (the Application). The Application also provides related notification regarding Westinghouses quality assurance program approvals, certificates of compliance, and the AP1000 design certification. The filing and requested NRC consent is necessitated by the change in control of Westinghouse from Toshiba Corporation to Brookfield WEC Holdings Inc. (WEC Holdings),
an affiliate of Brookfield Asset Management Inc. (BAM), as part of a proposed Plan of Reorganization associated with Westinghouses emergence from bankruptcy.
Toshiba Corporation (Toshiba) currently owns, indirectly through wholly-owned intermediate subsidiaries, 100% of the membership interests in Westinghouse. On March 29, 2017, Westinghouse, its immediate parent TSB Nuclear Energy Services, Inc. (TSB Services), and other affiliated entities filed petitions for bankruptcy protection in the United States Bankruptcy Court for the Southern District of New York (the Bankruptcy Court). On January 12, 2018, Brookfield WEC Holdings LLC (BWH), TSB Services and Toshiba Nuclear Energy Holdings (UK) Limited (TNEH UK) entered into a Plan Funding Agreement (PFA) that provides, among other things, for the acquisition by BWH of 100% ownership of TSB Services, Westinghouses parent company, pursuant to a Plan of Reorganization that has been submitted by Westinghouse to the Bankruptcy Court. The parties agreed to an expedited schedule for seeking
Document Control Desk U.S. Nuclear Regulatory Commission March 21, 2018 2
Bankruptcy Court confirmation of the Plan of Reorganization. At the closing under the PFA, WEC Holdings will have acquired 100% ownership of TSB Services and, indirectly, Westinghouse, and Westinghouse and TSB Services will exit bankruptcy protection.1 This acquisition is the ultimate transaction. All references to the transaction in this filing, unless otherwise specified as the interim transaction, are references to the ultimate transaction.
BWH is a limited liability company organized under Delaware law. BWHs business address is:
250 Vesey Street, 15th Floor, New York, NY 10281. WEC Holdings is a corporation organized under Delaware law. WEC Holdings business address is: 250 Vesey Street, 15th Floor, New York, NY 10281. Both BWH and WEC Holdings are ultimately controlled, through a number of intermediate holding companies and investment funds (detailed in the proprietary Exhibit C-2 in the enclosed Application), by BAM, a global alternative asset manager co-listed on the New York, Toronto and Euronext stock exchanges. BAM has over $265 billion in assets under management and owns and operates assets with a focus on property, renewable power, infrastructure, and private equity. BAM has a strong presence in the United States and manages $141 billion in assets and 9,500 employees in the U.S. BAM also has substantial experience in the power industry, with 4,000 MW of installed capacity, 136 renewable hydro plants, and 370 miles of electricity transmission lines in the U.S. alone. Worldwide BAM has $33 billion in total power assets and 15,300 MW of capacity, including partial ownership of Comanche Peak Nuclear Power Plant through Vistra Energy. BAMs business address is: 181 Bay Street, Suite 300, Toronto, ON M5J 2T3. BAM will maintain control of Westinghouse at all times after the closing through its ownership, indirectly through WEC Holdings. If WEC Holdings were to contemplate a change of control, WEC Holdings would seek prior NRC approval.
The Application is submitted pursuant to Section 184 of the Atomic Energy Act of 1954, as amended, and the NRCs implementing regulations in 10 CFR § 70.36, 10 CFR § 110.50 and 10 CFR § 110.51. The Application follows NRC Guidance provided in NUREG-1556, Volume 15, Rev. 1, Consolidated Guidance About Materials Licenses: Guidance about Changes of Control and About Bankruptcy Involving Byproduct, Source, or Special Nuclear Materials Licenses (June 2016) and Regulatory Issue Summary 2008-19, Lessons Learned from Recent 10 CFR Part 70 License-Transfer Application Reviews (Aug. 28, 2008).
Westinghouse also holds four Certificates of Compliance (CoCs) for transportation packages, CoC numbers 9239, 9274, 9292, and 9297, and an NRC-approved Quality Assurance program; it also is the applicant for the AP1000 Design Certification contained in Appendix D of 10 CFR Part
- 52. See Exhibit B of the Application. Transfers of control involving CoCs, quality assurance program approvals, and design certifications are not subject to the consent requirements of AEA Section 184 or related NRC regulations. In the enclosed Application, Westinghouse notifies the 1
BWH is a special purpose vehicle established under the laws of Delaware, ultimately controlled by BAM.
Prior to closing of the transaction, BWH will assign, and WEC Holdings will assume, the transaction documents to which BWH is party so that WEC Holdings will be the direct acquirer of Westinghouse. WEC Holdings, also ultimately controlled by BAM, had not yet been formed at the time of the original transaction.
Westinghouse and WEC Holdings will inform the NRC of any changes to the planned assignment.
Brookfield Business Partners L.P., referenced in the Request for Threshold Determination submitted to the NRC on February 5, 2018, (ML18036A982) will be an intermediate parent of WEC Holdings.
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NRC of the changes in indirect ownership of the entity that has been issued the CoCs and the quality assurance approval, and the applicant for the design certification. In any event, the change in control will not result in any reduction of safety or any commitments made under these approvals.
There are currently no anticipated changes in the operations, key operating personnel or licensed activities as a result of the transaction and the indirect transfer of control. WEC Holdings will inform the NRC if changes become anticipated as part of this transaction. Westinghouse will remain a U.S. company and will continue to be headquartered in Cranberry Township, PA.
Westinghouse will continue to be the holder of the licenses, approvals, and CoCs, and will continue to be the applicant for the design certification, listed in Appendix B after the closing of the transaction. Current Westinghouse employees responsible for licensed materials and activities will continue to be responsible for such materials and activities after the closing of the transaction.2 Accordingly, Westinghouse will remain technically qualified as the licensee and will continue to fulfill all responsibilities as the licensee.
Westinghouse currently is, and at the conclusion of the transaction will continue to be, financially qualified to engage in NRC-licensed activities. Although currently in bankruptcy protection, Westinghouse remains financially qualified to engage in licensed activities at the Columbia Fuel Fabrication Facility as discussed more fully in the enclosed Application.3 The enclosed Application includes enclosed proprietary financial information showing income statements and pro forma opening balance sheet that demonstrate that Westinghouse is, and will be, financially qualified to continue its licensed activities. Westinghouse will also continue to comply with applicable NRC requirements for financial assurance for decommissioning.
The transaction is not currently anticipated to affect the organizational or operational structure described in the licenses, approvals and certificates. Further, there are currently no anticipated changes in operating organizations, locations, facilities, equipment or procedures associated with the licensed activities. There are currently no anticipated changes in the use, possession, locations or storage of licensed materials as a result of the transaction. Licensed activities of Westinghouse will continue in their current form without interruption resulting from the proposed indirect transfer of control. WEC Holdings will inform the NRC if changes become anticipated as part of this transaction.
2 Current Westinghouse personnel were identified in the License Renewal Application for the Columbia Fuel Fabrication Facility (CFFF) submitted on July 31, 2014, as updated. See Letter from N. Parr to Director, Office of Nuclear Material Safety and Safeguards and Environmental Review, Westinghouse SNM-1107 Updated Renewal License Application (Sept. 15, 2017) (ML17261A085).
3 On December 20, 2017, Westinghouse submitted an application for termination of the license for the Hematite facility. See Letter from V. Kelmeckis, Westinghouse, to Document Control Desk, Hematite Decommissioning Project: Application for Termination of License No. SNM-00033, Docket No. 070-00036 (Dec. 20, 2017) (ML17355A043). The remaining activities at the Hematite facility are adequately funded by remaining decommissioning funds.
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ADDITIONS TO SERVICE LIST Ray P. Kuyler, Esq.
Assistant General Counsel Westinghouse Electric Company 11333 Woodglen Drive, Suite 202 Rockville, MD 20852 Telephone: (301) 230-4884 Email: kuylerr@westinghouse.com Timothy P. Matthews Grant W. Eskelsen Morgan, Lewis & Bockius LLP 1111 Pennsylvania Ave., NW Washington, D.C. 20004 Telephone: (202) 739-3000 Fax: (202) 739-3001 E-Mail: timothy.matthews@morganlewis.com E-Mail: grant.eskelsen@morganlewis.com Jay E. Silberg Jeffrey S. Merrifield Pillsbury Winthrop Shaw Pittman LLP 1200 Seventeenth St, NW Washington, D.C. 20036 Telephone: (202) 663-8063 Fax: (202) 663-8007 E-Mail: jay.silberg@pillsburylaw.com E-Mail: jeff.merrifield@pillsburylaw.com Robert W. Warnement Juliana Brint Skadden, Arps, Slate, Meagher & Flom LLP 1440 New York Ave., NW Washington, D.C. 20005 Telephone: (202) 371-7507 Fax: (202) 661-9040 E-Mail: robert.warnement@skadden.com E-Mail: juliana.brint@skadden.com