Meanwhile, it emerged that Nigel Rich, Trafalgar House's new chief executive, is on a £350,000 salary and is entitled to an unlimited bonus at the discretion of the board.
A spokesman for Northern Electric said the company was not worried by Mr Soros's move. "We are pleased to see a well known long-term investor buying into the company. He obviously sees value in it."
Quantum Partners, a fund managed by Soros Fund Management, bought the 1.33 per cent stake over an undisclosed period at prices ranging from £9.95 to £10.06. This compares with a closing price yesterday of £9.97 and Trafalgar's cash offer of £10.48.
Quantum said in a statement: "Quantum Partners holds positions in several UK regional electric companies and has expressed willingness to work with managements or potential acquirors to enhance shareholder value in the sector."
A spokesman for Mr Soros in New York declined to comment on whether there was any link between the group and the Trafalgar House bid.
The consensus among City analysts was that Mr Soros believes the the bid will not be referred to the Monopolies and Mergers Commission. The general market view is that the bid will be referred by Michael Heseltine, President of the Board of Trade, for political reasons.
Details of Mr Rich's service contract, available as a result of the bid situation, say his basic pay can never be reduced and put no limit on the bonus he can be awarded.
Mr Rich joined Trafalgar House in August after spending five years at the helm of Hong-Kong based Jardine Matheson. He moved to Trafalgar saying he was looking for a fresh challenge.
Initially, Mr Rich's contract is for a little over two years, and runs from the middle of last August to the end of September 1996. After that, the contract becomes a one-year rolling contract, in effect entitling Mr Rich to £350,000 compensation should he ever be forced out of his job.
James Watkins, appointed as Trafalgar's group legal director last October, is paid £220,000. He was previously a partner in the law firm Linklaters & Paines' Hong Kong office.
His contract also stipulates that his pay cannot fall. He gets an additional pension contribution of 21.2 per cent of his basic pay - this year worth over £46,000. He too can be paid a discretionary bonus and has his salary reviewed once a year.
Discretionary bonuses have met with the opposition of PIRC, which advises pension funds on corporate governance issues.
Offer, the electricity industry regulator, is expected to advise next week that Trafalgar's bid for Northern should not be referred on competition grounds, but there is a widely held view that the recommendation will be overturned.Reuse content