French firm EDF clinches British Energy take-over

British Energy accepted a take-over bid worth more than 15 billion euros from French electricity firm EDF in a tie-up set to transform Britain's nuclear energy sector, officials said Wednesday.
The French group announced that British Energy's managers had accepted its offer and would recommend it to shareholders, prompting Britain's Prime Minister Gordon Brown to hail it as "a significant step towards the construction of a new generation of nuclear stations to power the country."
The British minister for business John Hutton called it "one of the largest foreign direct investments ever made in Britain," in a government statement. The deal, priced at 774 pence a share, will create a new subsidiary controlled by EDF, the French group said. It expects the take-over to be sewn up by the end of 2009.
The take-over will cost EDF up to 15.7 billion euros (23 billion dollars), depending on the exact payment terms agreed by shareholders, the company said. It had earlier estimated the price as 15.6 billion. The French group's chairman Pierre Gadonneix said: "For EDF, this is an historic milestone in our strategic development plans in Europe and enables the EDF Group to develop significantly in the UK, one of its key markets."
An earlier offer, unveiled in late July for 765 pence per share or 15.45 billion euros, was rejected by two of British Energy's shareholders, investment funds Invesco and M and G. EDF said on Wednesday that Invesco had accepted the higher offer, which will create a new EDF subsidiary named Lake Acquisitions and will give EDF control of all British Energy's nuclear power plants.
The British energy sector has long been privatised, and the British treasury now holds 35.2 percent of British Energy. The French state by contrast owns around 85 percent of EDF, the world's biggest producer of nuclear energy. The British government welcomed the announcement.
Hutton said EDF intended to build four new nuclear reactors in Britain, with a combined capacity of 6.4 gigawatts. The first of them will start operating in 2017, he said. "The four new reactors that EDF is proposing to build would generate clean electricity to meet more than 13 percent of forecast UK electricity demand by the early 2020s," the text of the government statement added.