CB&I has since launched a legal appeal that is pending. A Westinghouse spokeswoman reiterated on Tuesday that the company expected the issue to be decided by an independent third-party auditor pursuant to the terms of the deal with CB&I.
“Both the (CB&I legal) appeal and the independent auditor process are expected to be determined in 2017. CB&I will continue to defend its position vigorously in both processes,” a CB&I spokeswoman said.
CB&I received no upfront payment for the sale of the nuclear construction business, but stood to receive earnouts based on the progress of the completion of two U.S. projects by Stone & Webster: a nuclear power plant in Georgia for Southern Co and two reactors in South Carolina for SCANA.
CB&I and Westinghouse were consortium partners building those reactors prior to their deal for Stone & Webster, which was meant to resolve disagreements over each contractor’s responsibilities over the projects.
As of Sept. 30, CB&I had incurred an after-tax goodwill impairment charge in 2016, as a result of the sale of its nuclear operations to Westinghouse, of $ 904 million. In 2015, it incurred another $ 1.1 billion after-tax impairment charge.
Shares in Toshiba, which remains on the Tokyo bourse’s watch list due to concerns about internal controls, finished 12 percent lower, giving it a market value of around $ 14.2 billion. CB&I shares were flat in afternoon trading in New York on Tuesday at $ 34.19.
Prior to Tuesday, Toshiba had forecast a full-year net profit of about 145 billion yen this financial year, a turnaround from a loss of 460 billion yen, thanks to strong demand for flash memory chips from Chinese smartphone makers.
Masahiko Ishino, an analyst at Tokai Tokyo Research Center, said the focus may soon shift to whether Toshiba will divest some of its businesses if the latest loss wipes out its shareholders’ equity.
“There will be a lot of companies that want to buy Toshiba’s businesses,” Ishino said. “It is possible that its NAND flash memory business would attract various buyout offers as there are few players in the market,” he said.
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