Power Group Online Article |  | |
17 July 2006 - The UK government is planning sell off part of its stake in the nuclear power generating firm British Energy that it rescued from bankruptcy fours years ago. The plan is to be revealed later this week in a written parliamentary answer and details will be set out in the next Budget.
According to a report in the Financial Times the sell off could raise £2bn with the value of the company having been boosted by the planned revival in nuclear power both in the UK and in other countries as well as sustained high energy prices.
The decision to sell off British Energy comes in the wake of the publication of the UK Energy Review, which backed building a new generation of nuclear power plants to plug a gap in Britain's future energy needs.
Government officials say that the rationale behind the sale is to avoid a conflict of interest arising in the authorization of new UK nuclear power plants.
British Energy was privatized in 1996 but bailed out by the government in 2002. As a result, the government has a right to 65 per cent of the company's net cash flows, which can be converted into shares.
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