Britain's fleet of nuclear power stations could be in the hands of the French by the end of the month.

British Energy, which runs the UK's atomic reactors at eight plants around the country today confirmed a deal is close with an unnamed party - understood widely in the City to be EDF.

Following another wave of speculation about an £11 billion to £12 billion deal with EDF which had sent British Energy shares soaring 44p to 730p, the UK company told the Stock Exchange: "The board of British Energy confirms that it is in advanced discussions with one party."

A deal with EDF, state-owned French electricity monopoly and nuclear generator which trades in the UK as EDF Energy and controls the power networks in London and the south east, will run into immediate competitions issues.

Many believe EDF will aim get round those by offloading a minority stake to British Gas group Centrica.

At stake is the future of the Britain nuclear industry and the building of at least four new nuclear power stations.

The Government has swung behind strong support for nuclear as a key way of keeping the lights on as foreign gas imports become ever more expensive and as the much-vaunted investment in wind energy is unlikely to deliver significant amounts of power until 2020.

In its statement British Energy warned there can be no certainty that an offer will be made as it and EDF haggle over price.

It is believed EDF had been looking to do a deal at 700p while British Energy shareholders have been lobbying for an offer nearer 800p.

The Government is known to be keen for a deal to go though. It will reap a £4 billion windfall from its 35% stake in British Energy, the holding it took after the taxpayer rescued the company from bankruptcy five years ago.