UK disfavours British Energy deal with Centrica

Any possibilities of Centrica merging with British Energy seem to be dimming with the UK government expressing its reservations about the merger. British Energy, a nuclear organisation is in merger talks with Centrica, that already owns British Gas. Centrica in a press statement, expressed its interest in merging with British Energy in case the highly publicised and mammoth bid of £12bn by EDF did not materialise. Due to intense media scrutiny and reporting on Centrica’s interest in British Energy, the UK Takeover Panel stepped in to request clarifications. Centrica then stated its present position of engaging in negotiations with EDF for acquiring a minority stake in British Energy, in case EDF’s acquisition of British Energy did not materialise.

In case its talks with EDF does not work out, Centrica would then consider three options; entering into supply deals with British Energy for a substantial period of time, participating in British Energy’s future nuclear plans and evaluating the possibility of merging with British Energy.

This statement from Centrica brought forth reactions from UK government officials that the options being considered by Centrica would require sanction from the government that held 35% ownership of British Energy. The UK government also believes, the official said, that Centrica did not have the advantage of cutting edge nuclear skills and technology, which are the need of the hour at British Energy. On the other hand, if EDF does manage to fully acquire British Energy, the UK government would be far happier. That would mean generating finances which are sorely needed by British Energy.

Please visit www.british-energy.com, www.centrica.com and www.edfenergy.com for more details