The country's second-largest utility said it would sell-off between 25 and 49 per cent of Scottish Telecom, which analysts value at between pounds 1bn and pounds 2bn.
Some market-watchers expect that the run-up to the change of year could witness unusual liquidity patterns as investors stay out of markets to minimise risks from y2k-inspired computer failures. Gerling, a German insurance company, has delayed its pounds 1bn float in London until after the new year.
Ian Russell, ScottishPower's deputy chief executive and finance director, said the long-planned sale would release the value of the phone and Internet business.
News of the floatation had been expected since ScottishPower appointed Goldman Sachs earlier this year to advise on options for developing Scottish Telecom. The transaction will not include ScottishPower's mobile phone operations.
"There is a lot of talk about the last time that we can make an issue ... I think that we are determined to get this done in 1999, before Christmas," Mr Russell said.
The listing will comprise an offering of ordinary shares, marketed to institutions on both sides of the Atlantic.
Mr Russell said that the size of the float would depend upon the strength of demand from potential investors, but ScottishPower would retain a majority interest in the business.
"We thought that this was an appropriate time for us to realise value for our shareholders," Mr Russell said.
Michael Hughes, director at Baring Asset Management, said that many investment houses had already taken "insurance positions" over the summer, and could stand ready to capitalise on any radical shifts in price caused by the millennium.
"It's not an impossible time to do business, but could be different," Mr Hughes said. "The end-of-year effect has already been discounted. The insurance is already in place... "
ScottishTelecom, which had sales of pounds 166m in the year to March, operates telecom and Internet services across the UK and in the Netherlands.
In April 1998, it acquired for pounds 66m the Internet portal, Demon Internet, Britain's second-largest web-hosting business. It also provides call centre and tele-marketing services.
Mark Robinson, an utilities analyst at ABN Amro, said: "It's a good business; Scottish Power have done well to develop it."
Analysts said ScottishPower was keen to try to emulate the success of the National Grid, the power transmission company which spun off its telecoms business, Energis.
Since their debut two years ago, Energis shares have surged. They ended 33p lower yesterday at 1,467p.
One analyst said yesterday: "I think that the listing is feasible. They've been preparing behind the scenes. It is tight, but ScottishPower are very organised." Scottish Power shares added 15.5p yesterday to close at 601.5p.
Predictions of problematic market conditions in December are not shared by everyone, however. Marshall Whiting, analyst at SG Securities, said: "I don't think that there's anything in the millennium issue - it is just an excuse for people to do no work."Reuse content