EDF fails to push Britain’s nuclear button

August 1, 2008

british-energys-heysham-nuclear-power-station.jpgA dramatic last-minute hitch to plans for France’s EDF to buy British Energy leaves managements, shareholders and especially the British government in a quandary.

It was a 12 billion pounds ($24 billion) deal that was supposed to relaunch Britain’s nuclear energy programme. Everyone had been told to expect it. In fact, the collapse of talks came too late for French newspapers, several of which had been briefed on the deal and splashed it prominently on their front pages on Friday.

In end, however, big insitutional investors persuaded British Energy to reject EDF’s offer as low-ball, despite the best endeavours of the British government, with a 35-percent stake. 

So what happens next? Talks are continuing and British business minister John Hutton says he remains convinced an EDF takeover makes sense; yet the gulf between the EDF and British Energy boards on price is clearly substantial. British Energy says there can be no certainty of any deal.

It is yet another headache to spoil Prime Minister Gordon Brown’s summer holiday, as his popularity slumps to a record low .

(Reuters photo: A sign is seen on the security fence of British Energy’s Heysham nuclear power station)   


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If it ever becomes possible for a British power company to take over a French one (and if, which is more likely, Gloucester Old Spots are seen flying over Hinkley Point), then EDF will be welcome to British Energy. Until that time, I think such strategic national assets as nuclear power stations should remain in British hands.

Posted by Matthew | Report as abusive

I guess the sites will be offered piecemeal, slower but probably better than placing the nuclear camp in the basket of one owner. Also offers the chance for other reactor designs (apart from French) to be used in the UK and increase build competition. This process needs to be started quickly if an energy gap is to be avoided.

Posted by ian | Report as abusive

As in the words of Adam Smith, it is unwise to invest capital abroad or attract capital investment from abroad. Smith warns such endeavors lead to the use of military force to protect influential investors. Yet this is the current practice of multi-national corporations which is referred to as globalization. It is unlikely we should see war between nations anymore (accept the U.S.), however WTO trade talks have been marred by violence and protest. Rwanda, Darfur, the Cong… I wonder just how much oppression and poverty the people of third world endure behind the agreements reached between their corrupt governments and large global corporations. Amnesty International for years has consistently sighted low wages as the leading cause of poverty.

Posted by Anubis | Report as abusive