BRITAIN'S nuclear industry could be set to fall under foreign ownership, after British Energy revealed it was in talks that could lead to a takeover offer for the firm.
The Livingston-headquartered company, which operates eight of Britain's ten nuclear power plants, said it was in discussions with several companies over developing new nuclear capacity.
In a statement issued yesterday, British Energy, which owns
the Hunterston B plant in Ayreshire and Torness in East Lothian, did not name the firms it has held talks with. The company said only that the discussions "could lead to a business combination or an offer for the company, although there can be no certainty that any offer will be made".
Well-placed sources yesterday said Europe's major utility firms had been approached about acquiring the UK government's stake in British Energy. The companies said to have been approached included British Gas owner Centrica, as well as continental players such as French nuclear giant EDF, German firms E.ON and RWE, and Spain's Iberdrola.
All of these companies have previously expressed interest in developing nuclear capacity in partnership with British Energy.
The government still owns 35 per cent of British Energy after bailing out the company when it came near to collapse in 2005, but has said it is reviewing its ownership of the stake. It has hired UBS as advisers.
A government spokesman said UBS was advising it on all commercial aspects of development on new nuclear capacity, and ministers were not actively marketing its stake for sale.
Speculation over a sale sent British Energy shares up as much as 17 per cent yesterday as the wider FTSE 100 tumbled. They closed up 11.2 per cent at 635.5p, their highest level in 18 months.
A source close to British Energy yesterday insisted there had been no firm offer, and a partnership deal, rather than a sale, was still a strong possibility. Talks with possibly partners had been going on for more than 12 months but the source said an announcement was not imminent.
Analysts at Credit Suisse said EDF was the "most probably candidate" to launch a takeover of British Energy, because of its nuclear expertise and strong financial position. Iberdrola and E.On also have major nuclear operations.
Evolution Securities analyst Lakis Anathasiou said a government sale of its stake to a single party was unlikely and it was more likely to split the shares between at least two companies.
The full article contains 419 words and appears in The Scotsman newspaper.
