British Energy in plans to delist

British Energy, the electricity producer, is seeking consent to be delisted from the stock exchange to prevent rebel shareholders from sabotaging its rescue package.

British Energy announced that it had submitted an application to the United Kingdom Listing Authority as well as the London Stock Exchange asking to be delisted and halting the trade of its ordinary shares as well as the A-class shares. The statement from British Energy also revealed that it would also seek to be delisted in the United States.

Shareholders in British Energy such as Brandes Investment Partners and Polygon Investment Partners have sought an extraordinary meeting in a bid to halt the move by the electricity producer to delist. The shareholders say that the five billion rescue package by the United Kingdom Government which has already been approved by the European Commission will leave them worse off.

British Energy which is sinking in debt maintains that the rescue package in which creditors would swap the debt for equity so that the shareholders only retain a two and a half per cent stake is the only way out for the energy giant.

The restructuring plan for British Energy which is based in Livingston and which provides approximately a fifth of the electricity in the United Kingdom was given the go-ahead by the European regulatory authorities but the European Commission cautioned that this was on condition that the firm would not use the rescue package provided by the state to achieve any competitive advantage.

Other conditions include that British Energy restricts its electricity generation output to present levels for six years. It will also not be allowed to engage in generating electricity using fossil fuels in countries other than the United Kingdom and it cannot buy any hydro power station from its rivals in the United Kingdom.

www.british-energy.com