EDF swoops on British Energy ... but gives back plants

French group poised for £12bnBritish Energy takeoverEnergy with plans for improved offer

FRANCE’s EDF is this week poised to clinch a £12 billion takeover of British Energy (BE), the nuclear power company, and will immediately signal that it is prepared to hand back two key nuclear sites to the government for auction.
BE’s holdings at Dungeness, on the Kent coast, and Bradwell, in Essex, are expected to be carved out and included in a separate package of sites for new nuclear stations.
The package will be auctioned later this year. Power companies will be invited to tender for some or all of the sites, with Germany’s RWE and Eon, Spain’s Iberdrola and Sweden’s Vattenfall expected to make bids.
As well as Dungeness and Bradwell, the sites to be auctioned include some that have old nuclear stations that have been shut down.

They are currently owned by the Nuclear Decommissioning Agency (NDA), the government body responsible for cleaning up the waste from Britain’s first generation of atomic power plants.
Ministers and officials hope the auction will create one or more competitors to EDF, and speed up the construction of new reactors, with multiple sites under development at the same time.
EDF’s planned takeover of BE ran into trouble last month when two of the British group’s largest shareholders, Invesco and M&G, rejected its bid.
As revealed by the The Sunday Times a fortnight ago, the board of the French utility group is this week expected to approve a new offer, up from 765p a share to 774p a share, valuing BE at about £12 billion.
The increased offer — and indications that Invesco will accept it — are expected to be enough to allow the BE board to recommend the deal.
The government holds an interest of 35% in BE, and has already indicated that it will accept the EDF offer.
If the takeover of BE is successful, EDF is expected to press ahead with the construction of reactors at Hinkley Point in Somerset and Sizewell in Suffolk. Industry experts think it will build two reactors at each site.
Meanwhile, Westinghouse, the Japanese-owned nuclear reactor group, will this week say that the construction of its plants could bring a £30 billion boost to the British economy.
A study it has commissioned on the economic impact of new stations using its reactor design will be unveiled at the Labour party conference in Manchester tomorrow.
John Hutton, the business secretary, who will attend tomorrow’s launch, said: “This report illustrates why I am so determined to press all the buttons to get nuclear facilities built in this country at the earliest opportunity.”
Britain’s nuclear regulators are in the process of examining designs for new power stations. Westinghouse and Areva (the French group that will supply EDF) have submitted plans, but last week General Electric and Hitachi, which have a joint design, withdrew from the process. The pair are expected to resubmit their proprosals next year.