British Energy 'overhaul' finalised
The financial restructuring of British Energy was finally completed today after the nuclear generator received court approval for its overhaul.
Shares in a newly-listed company should start trading on Monday, although the company warned it still had much work to do to improve its performance.
The restructuring, which went before the High Court in Edinburgh today, was drawn up in October 2003 after low wholesale prices sent the company deep into the red. Banks and bondholders will write off more than £1bn (€1.4bn) in debt in return for control of the group – leaving shareholders with just 2.5%.
Without the debt-for-equity swap, which required the backing of the British government and the European Commission, British Energy would have faced insolvency.
Today, it described the two year process as “one of the most complicated restructurings in UK corporate history”.
Chief executive Mike Alexander added: “The restructuring has been successfully implemented but our job is far from over. The new management team has started to address the past under-investment and unacceptable output.
“We must put that right but it will not be easy and it will take time.”
The company added that the rest of 2004/5 would be difficult due to a number of unexpected shutdowns at its plants since mid-March and delays in reopening power stations at Hartlepool and Heysham.
Shares in the newly-listed company are expected to be priced at around 315p and value the business at £1.8bn (€2.6bn).
The East Kilbride-based group’s sites are at Hartlepool, Heysham; Hinkley Point, Somerset; Hunterston, Ayrshire; Dungeness, Kent; Sizewell, Suffolk and Torness, East Lothian.
