Horizon Nuclear Power will be sold to Japan's electronics concern Hitachi for 860 million euros ($1.12 billion), under a deal expected to be completed by the end of November, E.ON and RWE said Tuesday.
Germany's two biggest power utilities went 50-50 to form the joint venture in 2009 with the aim of building between four to six nuclear power plants at British sites in Wylfa, Anglesey, Oldbury and Gloucestershire.
However, estimated construction costs of 18 billion euros were too high, RWE Chief Executive Peter Terium said, rendering the project unprofitable.
"We stop investing in new nuclear power plants because we can no longer afford the financial risk and adverse market conditions involved in nuclear projects," Terium added.
Hitachi signs up venture participants
Hitachi said in a statement Tuesday that it had signed a memorandum of understanding with British firms Babcock International and Rolls-Royce, as well as with SNC Lavalin from Canada, which wanted to join the Japanese electronics giant in the endeavor.
Hitachi also announced that it was seeking to have the first nuclear plant operational in the first half of the next decade.
In addition, the Japanese firm, which earns just under 10 percent of its sales from power systems, promised to create new jobs, saying it was aiming to significantly invest in the training of engineers, construction teams and operating staff in Britain.
The two German utilities, which each run nuclear power stations in Germany, reportedly made a profit of about 100 million euros from the deal.
Both companies are currently selling off non-core subsidiaries in attempts to reduce debt and to re-focus business on renewable forms of energy generation.
uhe/ipj (Reuters, AFP, dpa)