18 Mar 2002 – RWE, the German utility, is this week expected to announce the £3bn ($4.27bn) take-over of Britain’s second largest electricity and gas company Innogy, according to a Sunday Times report.
The paper claimed exclusive knowledge of the bid, which it said would be between 270p, and 275p per share – a premium of about 26p on Friday’s closing price.
A inside source was quoted as saying, “Negotiations are continuing but the likelihood is that a bid will come this week in the low 270s.”
RWE are thought to be the only remaining bidder after Scottish Power said it was no longer pursuing the company. Officials from RWE were not available to comment on the story.
Brian Count, chief executive of Innogy, is thought to have rejected a previous bid of 258p per share but is not expected to hold out for the 300p sought by some shareholders given the limited interest.
RWE has available funds of £12bn but will be wary of overpaying for Innogy with electricity prices low and much generating capacity being offline in the UK at present.
Innogy has a strong customer base in the UK and has seen trading levels increase following the collapse of Enron.
Innogy shares were standing around 255p in Monday morning trading.