30 October 2002 – The UK government yesterday cleared the way for Powergen plc to bid for Britain’s Midland Electricity, which has been put up for sale by its US owner Aquila Inc.
Powergen, part of German multi-utility E.ON, only last week bought the UK retailing and generating assets of TXU Europe for à‚£1.37bn ($2.14bn). and had been prevented from bidding for Midland struck after the electricity regulator blocked a take-over attempt in 1997.
Aquila is reported to have asked interested parties to submit indicative bids for Midlands Electricity, which distributes power in central England, by Wednesday.
Midlands is thought to have an enterprise value of around à‚£1.1bn ($1.7bn) but that the business was highly leveraged and would sell for around a couple of hundred million pounds in cash.
The DTI said in a statement it had been advised that the country’s energy industry had changed substantially since 1997 and there was no need to bar Powergen on anti-competitive grounds.
Scottish & Southern Energy are also thought to be interested in Midlands.