EdF sets sights on Seeboard supply and Drax

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The Independent Online
ELECTRICITe de France, the state-owned group which bought London Electricity last year, is interested in buying the supply business of Seeboard and may also bid for National Power's Drax power station.

The moves are part of a strategy by the French electricity company to build up a 15 per cent share of the UK electricity generation and supply markets in the longer term.

Bruno Lescoeur, who took over as chief executive of London Electricity on EdF's pounds 1.4bn takeover last November, said he had spoken to Seeboard about the possibility of acquiring its supply business.

He also confirmed that EdF had asked National Power for the information memorandum on the sale of the 4,000 megawatt Drax plant, although any bid for the power station would be in partnership with another energy company.

A takeover of Seeboard's supply business would create the country's biggest electricity supplier with four million customers covering a large swathe of the South-east.

Seeboard serves Kent and parts of East Sussex, West Sussex and Surrey and made pre-tax profits of pounds 135m on sales of pounds 135m. It has two million customers - the same as London Electricity - and its supply business could fetch pounds 150m to pounds 200m

Central & South West, the Texas utility which bought Seeboard for pounds 1.6bn in 1996, is thought keen to sell the company. But the sale has been delayed by the merger of Central & South West and AEP, another US utility, which owns 50 per cent of Yorkshire Electricity.

EdF's takeover of London Electricity gave it about 6 per cent of the UK electricity supply market. It also accounts for 6 to 7 per cent of the UK generating market through the cross-Channel interconnector with France.

But Mr Lescoeur said EdF's longer-term aim was to become one of five or six big integrated players with a 15 to 20 per cent share. Buying more supply businesses would provide a natural hedge for its generation interests. "We are here for the long term and that means we are looking at opportunities which will make us bigger and stronger," he added.

Other electricity supply businesses up for sale include Sweb's in the South-west and Hyder's in South Wales. United Utilities is also thought to be interested in selling Norweb.

Mr Lescoeur said EdF was not one of the potential bidders that had so far approached Hyder, but he did not rule out the possibility of a bid.

Outlook, page 17

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