BNFL blocked as it tries to sell its stake in Urenco

Row brewing with Germans and Dutch over British sale of £2bn stake in uranium company

The state-owned company can sell its 33 per cent stake in Urenco only with the unanimous agreement of all three shareholders. It is understood that Urenco's German and Dutch shareholders, who are interested in buying the BNFL stake, will not allow BNFL to offload it for its market value.

In response, BNFL has instructed lawyers to examine the details of the Almelo Treaty, which the Dutch, German and British governments signed in 1970, when Urenco was founded, to protect the nuclear enrichment technology the company would develop. BNFL, under chief executive Mike Parker, wants to find a loophole to allow it to sell its stake to another company for a market price without compromising the treaty.

Another option BNFL is exploring is that of floating its stake on the stock market, with the Government retaining a special golden share to maintain some control over future ownership. This move could fall foul of the European Commission, although there is a precedent for it. The Government was able to retain a modified special share in the nuclear generator British Energy.

The other two-thirds of Urenco are owned by UCN, a Dutch government-owned company, and the German energy companies RWE and E.ON. The Dutch and German governments do not want the company to be floated, or BNFL's stake sold to a third party. They are concerned that national security could be compromised by a new shareholder or a float.

When the Trade and Industry Secretary, Alistair Darling, was asked whether he objected to the privatisation of Urenco, he said: "I don't have a philosophic problem with the private sector being involved any more than the private sector is already involved in most of the supply of energy in this country. What matters is that it is sufficiently regulated and has sufficient safeguards."

In this year's Budget, Gordon Brown signalled his desire to sell off most of the remaining state-owned companies. This includes BNFL's stake in Urenco.

Uranium prices have soared in the past five years from $7 a pound in 2001 to $45, boosting Urenco's value. The company, which has a 20 per cent share of the global uranium enrichment market, made profits of €166m (£115m) after tax last year, up a third on the previous year.

A spokeswoman for the Buckinghamshire-based Urenco would not comment on the details of the negotiations between BNFL and other shareholders. "The decision on the future shareholding of the company has to be a decision by all of the board, not BNFL on its own. Shareholders of any company will always look to the best option for the company," he said.