A takeover battle for control of British Energy was gathering momentum as it emerged yesterday that the company had received two more preliminary proposals, one of which valued it at almost £11 billion.

The power company, whose eight nuclear and one coal-fired stations generate one sixth of Britain’s electricity, has received takeover or other approaches from EDF, the French state-controlled utility, and two other groups. RWE and Iberdrola, the German and Spanish utilities, submitted a tentative joint proposal this week, sources said.

Suez, the French industrial group, also submitted a proposal this week, although the company played down its interest. One source said Suez, which is in the midst of a merger with Gaz de France, is more interested in a collaborative deal to help to construct new nuclear power plants in the UK than it is in a large acquisition.

British Energy said it had been approached by “several parties wanting to make a full offer for the company” – inclusive of the Nuclear Liabilities Fund, which represents the Government’s 35 per cent stake. It did not name the bidders.

Two of the three offers were said to be priced higher than the company’s closing share price on Thursday night of 680p, which would value it at more than £10.8 billion.

The company said discussions were at an early stage and would require several weeks to develop further.

EDF’s offer of less than 700p per share was the only one submitted ahead of the deadline of May 9, which was set by Rothschild, the investment bank handling the sale.

Industry sources said that EDF remained the most credible bidder and that its offer was the farthest advanced. EDF, RWE and Iberdrola declined to comment.

The Government is determined to stimulate a competitive auction for British Energy, which is expected to play a key role in the drive to build a new generation of nuclear plants in the UK.

It wants to use the sale of its 35 per cent stake as an opportunity to kick-start a construction programme for new reactors in Britain.

The Government is keen to have the ownership issue resolved by the time that Parliament rises in July, amid concerns that a drawn-out auction could delay the planning and construction phases.

The Government is insisting that any buyer of British Energy would have to sell some key sites to ensure proper competition.

Centrica, the owner of British Gas, also remains eager to play a role but is struggling to mount a bid because its weak share price has undermined its financial firepower.

British Energy shares jumped on news of the additional approaches, touching highs of 730p, before closing up 35½p, or 5.2 per cent, at 715½p.

Nuclear power by numbers

35.2% The Government’s stake in British Energy

5,500 The number of British Energy employees

8 Nuclear stations including Sizewell and Dungeness

1 Coal-fired plant at Eggborough, North Yorkshire

18% Proportion of UK electricity currently generated from nuclear power

3 Proposals of interest in British Energy

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