Hitachi shares fall after MHI demands $6.7 billion in costs

TOKYO (Reuters) - Hitachi Ltd's shares fell more than 6 percent on Thursday after Mitsubishi Heavy Industries (MHI) asked it to pay 89.7 billion rand (5.33 billion pounds) to cover costs related to a joint venture working on a South African power plant project.

Hitachi's shares were trading 6.5 percent lower at 632.6 yen in early trade in Tokyo. That compares with a 0.5 percent dip in the benchmark Nikkei 225 index.

Hitachi has rejected the request and said it would continue talks with MHI. Mitsubishi Hitachi Power Systems Ltd, majority owned by MHI, was formed in February 2014 by combining the two companies' thermal power generation units.

Hitachi won a contract to build 12 boilers for the Medupi and Kusile power plants of South African utility Eskom in 2007 that it later transferred to the joint company.

(Reporting by Tim Kelly; Editing by Stephen Coates)