Centrica adds $7.7 billion cash part to all-share offer for British Energy stake
11 Aug 2008
Mumbai: UK electricity and gas supplier Centrica, which made an all-share offer to merge with British Energy, now says it is ready to add a four billion pound ($7.7 billion) cash portion to the offer for the government's stake in the nuclear power operator, media reports said.
Centrica made the merger offer after some shareholders of the British nuclear power operator rejected a 12 billion pound offer by EDF of France for the British government's 35 per cent stake in the utility.
Centrica's offer comes amidst reports that the UK government still favoured EDF's stalled 12 billion pound merger offer for British Energy. EDF has experience in building nuclear power plants.
The British government is planning to increase the number of nuclear power plants as part of a programmed aimed at limiting dependence on fossil fuels and thereby help cut carbon emissions.
This also sparked takeover interest in British Energy, which lacks the expertise to build new plants but has the best sites for setting up nuclear plants.
Centrica has enough cash and has no debt, although not experienced as EDF in nuclear power generation. EDF, Europe's number one electricity producer.
Under the takeover rules an acquisition of the government's 35 per cent stake in British Energy would automatically trigger an offer for the remaining stake in the company.
