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Centrica £2bn cash call for Energy buy
31.10.08
British Gas owner Centrica is to tap shareholders for £2.2 billion to fund the acquisition of a 25% stake in British Energy.
The stock dived 23¾p or almost 8% to 282½p after it launched the rights issue at 160p a share, with investors entitled to three new shares for every eight they hold.
Centrica said the funds were needed to buy the stake in British Energy, the nuclear-power giant set to be bought by French energy supplier EDF in a £12.5 billion deal.
Chairman Roger Carr said: "Assuming we reach agreement with EDF regarding Centrica acquiring a 25% interest in British Energy, the proceeds of the rights issue will be directed towards this opportunity, with the balance being funded with additional debt and, possibly, asset sales."
Centrica also said operating margins at British Gas were improving, but gave no indication as to whether this could lead to lower household energy bills.
