Mitsubishi Heavy Industries Ltd (MHI) jumped over 6 percent on Tuesday after an international arbitrator ruled in its favor over a $6.7 billion compensation claim against the company related to the shutdown of California's San Onofre nuclear plant.
Southern California Edison (SCE), a unit of Edison International, had raised a claim with the International Chamber of Commerce (ICC) demanding compensation from MHI. Both MHI and SCE said the ICC has ordered the former to pay $125 million to the nuclear plant owners. The arbitrator also ordered the plant owners to pay $58 million in legal fees to MHI.
"With the end of the U.S. nuclear legal dispute, which had been feared to weigh on MHI's net profit, the company's short-term risks are expected to be cleared," Mizuho Securities analyst Masanori Wakae said in a report.
SCE was seeking $6.7 billion, accusing MHI of contract violations for failing to properly design or quickly repair two steam generators it built for the utility's now-closed San Onofre nuclear plant.