Centrica to Buy Shareholdings in EDF-Owned British Energy

Centrica has been granted approval to buy 20% of British Energy’s shareholdings, which will help give Centrica, based in France, a British foothold. Centrica is a nuclear firm that operates in France, but with the 20% investment into British Energy, the company will be able to expand its nuclear holdings into the UK.

EDF, who owns British Energy, plans to enter into an 80/20 partnership with Centrica to develop four nuclear power projects in Britain. The approval from Britain’s consumer affairs will allow both companies to proceed with the expansion and development of nuclear power plants. 

Friday the Office of Fair Trading in the UK stated that it believed the joint venture would not decrease competition in the wholesale electricity industry, although some companies in the industry felt that it could. Both companies announced in May, that Centrica, who owns British Gas, would appeal to purchase the stake for 2.3 billion pounds. 

Having been granted approval to buy the 20% of British Energy, EDF is still waiting for the European Commission to approve their plan to purchase Centrica’s stake in SPE, a Belgian based utility, which will be incorporated into the overall deal.

Currently EDF shares are up 0.8 percent to 34.3 euros and Centrica’s share have gone up 0.9 percent to 219.5 pence.