A UK power firm has moved to the brink of foreign ownership as shareholders approved a merger between International Power and France’s GDF Suez.
The boss of GDF Suez hailed the deal – which will see the French firm own 70% of the newly formed business – as the most “important merger and acquisition in Europe in 2010”.
The tie-up, which was cleared by 99% of International’s shareholders but is subject to regulatory approval, will combine the UK firm’s 45 power stations with GDF’s international assets.
The merger comes after British Energy was bought by another French company, EDF, for £12.5 billion in 2008. It leaves Britain owning just two independent energy producers in Centrica and Scottish & Southern Energy.
It also follows an Office of Fair Trading report which revealed more than a third of the UK’s infrastructure – such as energy, water and transport – is under foreign ownership.
International Power owns the giant coal-fired station at Rugeley in Staffordshire, which powers the equivalent of half a million homes, and is a majority owner in the First Hydro hydroelectric plans in North Wales.
In August, the company reported half-year profits of £524 million after strong contributions from operations in Australia and the Middle East were offset by weaker profits in North America.
GDF Suez said the deal will make it a global leader in independent power generation, and the newly formed business will employ a combined 11,000 people.
Gerard Mestrallet, chairman and chief executive of GDF Suez, said: “The group will hold top positions in perfectly complementary and rapidly growing geographical zones, regions that will have substantial energy needs in the future.”
In the last 10 years, Ferrovial of Spain has bought BAA, the operator of Heathrow and Stansted airports, Germany’s RWE has acquired npower, and Australian bank Macquarie has taken control of car parks by buying NCP.