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The move comes as
Toshiba sees Westinghouse's bankruptcy as increasingly likely.
The Japanese conglomerate has hired restructuring consulting
firm Berkeley Research Group LLC and law firm Skadden, Arps,
Slate, Meagher & Flom LLP to help defend it against bankruptcy
claims, the people said on Wednesday.
Scana Corp <SCG.N> and Southern Co <SO.N>, the power utilities
which hired Westinghouse to build the first nuclear power plants
in the United States in more than 30 years, have also hired
restructuring advisers, the people said.
This is because, in a potential Westinghouse bankruptcy, Scana
and Southern Co would be among Westinghouse's largest creditors,
owed the cost overruns on the projects, which tally in the
billions of dollars, one of the people added. The utilities are
hoping to recover these costs in a bankruptcy process for
Westinghouse, according to the sources.
Scana has hired restructuring experts from advisory firm Ducera
Partners LLC, while Southern Co is working with investment bank
Rothschild & Co, the people said. Scana owns the South Carolina
plant under construction, while Georgia Power, a subsidiary of
Southern Co, will own plants in Georgia.
"Whether or not Westinghouse files for Chapter 11 (bankruptcy)
is ultimately a decision for its board, and must take into
account the various interests of all of its stakeholders,
including Toshiba and its creditors," Toshiba said in a prepared
statement. "It is not appropriate for Toshiba to comment
prematurely."
The conglomerate has also said bankruptcy is one of several
options for Westinghouse, which it acquired for $5.4 billion
about 10 years ago.
The sources asked not to be identified because preparations for
a potential Westinghouse bankruptcy are confidential.
"We're continuing to monitor the situation with Westinghouse and
are prepared for any potential outcome," Georgia Power said in a
prepared statement.
Spokespeople for Berkeley Research Group, Scana and Skadden did
not immediately respond to requests for comment. Ducera and
Rothschild declined to comment.
Toshiba has said it would take a $6.3 billion writedown related
to Westinghouse, and gained an extension from Japanese
regulators until April 11 to submit its latest quarterly
financial results or face having its public shares delisted from
the Tokyo Stock Exchange.
Reuters reported earlier this week that Westinghouse was
reviewing proposals for a debtor-in-possession loan exceeding
$500 million to help finance its potential bankruptcy.
Westinghouse has already hired restructuring counsel, Reuters
reported earlier this month.
(Reporting by Jessica DiNapoli in New York; Editing by Stephen
Coates)
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