![Show Menu](styles/mobile-menu.png)
![Page Background](./../common/page-substrates/page0266.jpg)
20.2 Notes to the consolidated financial statements for the year ended December 31, 2016
FINANCIAL INFORMATION CONCERNING ASSETS,
FINANCIAL POSITION AND FINANCIAL PERFORMANCE
20
Bioenergy operations
In an unfavorable market environment and with no possibility for its sale, it was
decided in April 2015 to terminate the Bioenergy Europe operations. Similarly,
following inconclusive discussions with potential buyers in 2015, the decision
was made on February 22, 2016 to terminate the Bioenergy Asia and Bioenergy
Brazil operations. The Bioenergy operations are to be gradually phased out while
meeting AREVA’s contractual commitments, in particular upon completion of the
GIFT project in the Philippines and the Commentry project in France.
Nevertheless, following the announced cessation of Bioenergy Brazil operations,
various claims were made against the Bioenergy Brazil entity. Consequently, all of
the litigation in progress in Brazil has been reassessed, and additional provisions
were set up at June 30, 2016.
Koeberg contract
On September 6, 2014, AREVA signed a contract with the South African utility
Eskom to replace the steam generators of the Koeberg nuclear power plant.
This 4.3-billion-rand project (about 300 million euros) called for the design and
manufacturing of six steam generators, their installation in the power plant’s two
reactors, and related engineering services.
On August 27, 2014, Westinghouse submitted a complaint to the South African
courts challenging the call for bids process which led to the award of said contract
to AREVA.
Thrown out by the lower court, Westinghouse’s claims were partially admitted by
the Supreme Court of Appeal which, on December 9, 2015, annulled the decision
awarding the contract to AREVA but declined the request for the substitution of
Westinghouse.
Eskom and AREVA appealed that decision before the Constitutional Court of South
Africa in January 2016. On December 21, 2016, the Constitutional Court of South
Africa rendered its decision in favor of AREVA, finding Westinghouse’s request for
annulment of the call for bids inadmissible.
Miscellaneous investigations
AREVA is also aware of the existence of other preliminary investigations in progress
led by the French National Financial Prosecutor’s Office.
Since these inquiries are being carried out in connection with legal proceedings
against parties unknown, AREVA is not currently implicated.
NOTE 35.
EVENTS SUBSEQUENT TO YEAR-END
On January 5, 2017, AREVA’s interest in Adwen was sold. Gamesa is taking over
AREVA’s offshore wind energy operations (see note 3). AREVA’s off-balance-
sheet commitments are taken over by Gamesa. AREVA retains the obligations for
indemnification according to the new terms.
On January 10, 2017, the European Commission gave its consent to the French
State to participate in the capital increases of AREVA SA and of NewCo (see
note 1.1).
On February 3, 2017, the CombinedGeneral Meeting of Shareholders approved the
capital increase reserved for the French State in the total amount of 2 billion euros.
In addition, the par value of the AREVA SA share was reduced from 3.80 euros
to 0.25 euros.
On February 21, 2017, in accordance with the terms of the share purchase
agreement signed on January 5, 2017, Adwen sent a notice to AREVA and Gamesa
following the identification of quality problems on the fleet of wind turbines installed
offshore. More in-depth, technical counter-examinations will be necessary in the
coming months to determine the financial impact, the division of responsibilities,
and the solutions. In the absence of such information, no additional provision was
recognized at December 31, 2016. Based on Adwen’s estimates, which have not
been verified by AREVA at this stage, the maximum exposure would be 70 million
euros and would fall within the cap of guarantees given to Adwen, provided for that
purpose by the share purchase agreement (see note 24).
264
2016 AREVA
REFERENCE DOCUMENT