International Power to buy UK plants
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.International Power is poised to buy two UK power stations for about £300m, which would make the company a significant player in the electricity generation market in this country.
The group, which was foiled this month in its attempt to buy a strategic stake in the giant Drax station, is understood to have been named preferred bidder for two of Britain's largest coal-fired plants, Fiddler's Ferry in Cheshire and Ferrybridge in West Yorkshire.
The power stations were put up for sale by their US owner, American Electric Power, following the collapse in UK wholesale electricity prices. AEP bought the plants for £650m in 2001 from Edison Mission but has since been forced to write down half the acquisition price. Edison had paid £1.9bn for the stations in 1999.
A spokesman for International Power declined to comment on the deal but said: "We are interested in acquiring assets in the UK."
International Power was the overseas business of National Power, having been demerged in 2000. It operates the Rugeley and Deeside power plants in Britain and has operations in 11 other countries. The Fiddler's Ferry and Ferrybridge plants would give International Power some 6 per cent of Britain's generating capacity.
AEP has said it wants to sell its UK power stations by the end of 2004. Last year, the US group sold Seeboard, the south-eastern England electricity supplier, for £1.4bn to Electricité de France.
International Power has been hit hard by low power prices in the US, where it has a third of its assets. Although the UK had seen prices slump, leading to reduced production and the closure of some plants, more recently wholesale prices have risen on speculation that the country does not now have enough electricity to meet demand this winter. The jump in UK prices has led to a regulatory investigation and contributed to the decision by the owners of Drax not to sell out to International Power.
In November, International Power issued a warning on its expected earnings for 2004 on the back of a poor outlook for the US market. The company is considering mothballing some of its US capacity.
This month Philip Cox was promoted from chief financial officer to chief executive, replacing David Crane, who resigned in October to take a job turning around a bankrupt US power business.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments