Conclusion of Joint-Venture Agreement on Integration of Existing Thermal Power Generation Businesses
June 08, 2017
TEPCO Fuel & Power, Inc.
Chubu Electric Power Co.,Inc.
TEPCO Fuel & Power, Inc. (a 100% subsidiary of Tokyo Electric Power Company Holdings, Inc.) and Chubu Electric Power Co., Inc. today concluded a joint-venture agreement with the aim of integrating their fuel receiving/storage and gas transportation businesses, and existing thermal power generation businesses in Japan into JERA Co., Inc. ("JERA").
On March 28, 2017, the companies concluded a basic agreement on integrating existing thermal power generation businesses and have been engaged in detailed study and discussion in the lead-up to the integration, which led to an agreement on the "Post-Integration General Business Model/Integration Effect" and, "Detailed Rules on Measures that Prevent the Restriction on JERA Business Activities" etc., and the companies reached the conclusion of this joint-venture agreement.
After integration, JERA will engage in measures to "enhance the competitiveness of domestic power generation businesses," and "increase profits in new business areas/create synergy with existing JERA businesses" etc., as it aims to generate an integration effect in excess of 100 billion JPY/year within five years of implementation.
By leveraging this effect, along with engaging in fair competition including in the domestic electricity transaction market that is supposed to be created, JERA will be enabled to grow into a global energy company that can compete on equal footing with competitors in the international energy market. Furthermore, through these endeavors the companies shall provide a stable supply of globally competitive energy, and improve the corporate value of both the TEPCO and Chubu Electric Power groups.
With the aim of integrating during the 1st half of FY2019, the companies will move forward with discussions and all required procedures in the spirit of fairness and equality. The TEPCO Group is also fully committed to the revitalization of Fukushima through the integration.