British Energy rump nets pounds 120m for Treasury

The flotation of British Energy yesterday turned out to possess a silver lining for taxpayers after all, as the Government raised pounds 120m by selling its remaining stake in the nuclear power company.

The sale was part of a wider auction of the Government's rump holdings in privatised utilities, which raised a total of pounds 257m to help fund the tax cuts announced in last week's Budget.

Rothschilds, acting for the Treasury, sold 81 million British Energy shares to HSBC James Capel at 147.5p a share - a near 50 per cent premium to the price at which the partly-paid shares were floated in July.

The auction also saw Dresdner Kleinwort Benson pick up 18.8 million shares in Scottish Power equivalent to around 1.6 per cent of the company.

The Treasury also took advantage of a buoyant market to dispose of small residual stakes in National Grid, Northern Ireland Electricity, Scottish Hydro, PowerGen, Severn Trent, South West Water and Wessex Water. Most if not all of the companies that the Treasury sold shares in are vulnerable to Labour's windfall tax.

The proceeds from the sale of the Government's remaining stake in British Energy will come as a consolation to ministers after the way the original public offer flopped so badly last summer. The fully-paid shares were priced at just 203p - close to the bottom of the Government's target range, raising just pounds 1.4bn for the taxpayer - some pounds 500m short of earlier expectations. The first day of dealings turned into an unprecedented privatisation flop as the partly paid shares crashed by more than 10 per cent from their opening price of 100p.

Since then, however, the shares have recovered to be one of the best performing stocks on the market. Last night the shares closed unchanged at 147.5p - up 47.5p on their offer price 5 months ago.

The sharp rise in the share price has led to some mutterings that the company was sold too cheaply.

However, Government sources pointed to the fact that even at the rock bottom price of 203p it was still left with nearly 13 per cent of the company on its hands.

More than 600,000 private investors applied for shares, leaving the public offer 2.4 times subscribed and resulting in the allocation for small shareholders being raised from 30 to 43 per cent of the offer.

Suggested Topics
News
peopleFrankie Boyle responds to referendum result in characteristically offensive style
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
News
news
New Articles
i100
PROMOTED VIDEO
Life and Style
Couples have been having sex less in 2014, according to a new survey
life
Arts and Entertainment
musicHow female vocalists are now writing their own hits
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvHe is only remaining member of original cast
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam