White knights riding in from Texas

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The Independent Online
Houston Industries and Central and South West Corporation are two of America's largest utilities and have a combined market value of $10.4bn (pounds 7bn) and revenues of $7.8bn.

Houston, with market capitalisation of $5.5bn, is the ninth largest power utility in the US. Based on the Gulf coast of Texas, it generates and supplies electricity to about 1.5 million customers.

Dallas-based CSW International, which serves 1.7 million customers, is one of four subsidiaries within the giant CSW Enterprises. It was formed to own, operate and manage electricity investments outside the US, and has a market capitalisation of $4.9bn.

The two companies formed a joint venture company, Texas Energy Partners, to invest in utilities worldwide, though the cash-rich UK Recs are particularly attractive. They are not the only US companies eyeing the UK Recs.

Southern Electric International has purchased South West Electricity, and PacifiCorp is close to a bid for Manweb. Other US utilities are also expected to enter the ring.

The two Texas companies supply electricity to vast swathes of Texas, Oklahoma, Louisiana and Arkansas. They had been talking to Norweb for some time about the UK company joining them in an American power generation project, but the plans were put on hold after bid talks began.