Professor Littlechild has already said that changes to Northern's operating licence may be needed in the event of a takeover, to ensure that he can continue to regulate the core electricity business efficiently. Among his worries would be any reduction in his ability to compare the companies' operational and financial performance, which he regards as a vital part of his job.
Offer has declined to comment on its advice to the Office of Fair Trading, which must in turn advise Michael Heseltine, President of the Board of Trade, on whether to make a reference to the Monopolies and Mergers Commission.
Neither Trafalgar House nor Northern were able to shed any light on Offer's views. One industry source said that the idea of a 25 per cent flotation had been considered but is not necessarily a live issue now.