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Hitachi: Mitsubishi Heavy wants $6.65 billion over power project

Staff Writer | February 8, 2017
Hitachi said it has received a request from Mitsubishi Heavy Industries for $6.65 billion to cover costs from their joint venture's involvement in a South African power plant project.
Mitsubishi Heavy
Joint venture   The amount was almost doubled
Hitachi in a statement said it rejected the request as lacking legal ground, and that it would continue talks with Mitsubishi Heavy.

The amount is almost double an initial request MHI made at the beginning of a 10-month-old dispute over which of the Japanese firms should bear costs from the power plant project.

Hitachi won a contract to build 12 boilers for the Medupi and Kusile power plants of South African utility Eskom in 2007. It later transferred the contract to a joint venture with MHI.

The venture, Mitsubishi Hitachi Power Systems, is majority owned by MHI and was formed in February 2014 by combining the two companies' thermal power generation businesses.

But Hitachi and MHI fell out after being unable to agree on whether certain costs were incurred before or after the creation of the venture, a regulatory filing showed.