TXU Europe deal being finalised

GERMAN energy group Eon, owner of Powergen, is today understood to be finalising a deal to buy the UK arm of energy giant TXU Europe.Negotiations between the two continued throughout the day.

GERMAN energy group Eon, owner of Powergen, is today understood to be finalising a deal to buy the UK arm of energy giant TXU Europe.

Negotiations between the two continued throughout the day.

Spokesman for Ipswich-based TXU Nick Lakin declined to comment on the buyout.

He refused to reveal whether all staff would have to locate to Powergen's base in Coventry.

But he said if that was the case, it was too early to say if the 1,200 workers in Ipswich would have to move.

TXU employs a total of 2,000 staff across the country.

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Any relocation would involve senior management holding a series of meetings, to devise an integrated programme for the whole company.

A source close to the company told the Evening Star staff were anxiously waiting for an announcement, and expecting job losses, and offers of relocation to Coventry.

Zoe Coombes, spokeswoman for Powergen said today : "Negotiations were ongoing overnight, and are still continuing at the moment. We had hoped to have heard what's happening by now."

Electricity group Scottish and Southern Energy today confirmed it had been in talks to buy parts of TXU - but said discussions were now off.

In a statement to the London Stock Exchange, Perth-based Scottish & Southern said it had been in talks to acquire "certain assets" of TXU's UK energy supply business.

"Those discussions are no longer taking place,' it said.

Dallas-based TXU's European subsidiary owns the former Eastern and Norweb regional supply companies in the UK as well as three large coal-fired power stations.

It employs 1,600 staff in the UK and supplies power to 5.5 million domestic and business customers.

However the US group has hit problems and last week cut off a crucial 700 million US dollar (£448 million) funding supply to the European arm, saying the division will now either be sold or restructured.

Senior TXU executives spent last week frantically trying to renegotiate massive long-term contracts that have scuppered the business, with the wholesale price of electricity falling through the floor.

WEBLINK:

www.txu.com

www.powergen.co.uk

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