Scottish Power offer 'imminent'

Spanish power firm Iberdrola may launch its takeover bid for Scottish Power this week, according to the Observer.

On Friday, Iberdrola confirmed it was in negotiations with Scottish Power, but it is believed that the two have been in talks for two months.

But market watchers believe rival firms could still break up the talks.

French utility EDF and German rival RWE are believed to be keeping an eye on developments.

Last year, Scottish Power rejected a bid approach of 570 pence a share from German utility E.ON.

Split?

However, the Observer report also suggested that Iberdrola was examining the possibility of breaking up the UK group.

Under such a plan the Spanish firm would hold onto Scottish Power's renewable energy assets, while an infrastructure fund would take on its transmission and distribution networks.

Scottish Power supplies energy to 5.2 million UK customers.

It also has electricity generation and gas storage facilities in the UK, US and western Canada, and is Britain's biggest generator and developer of wind energy.

On Tuesday, the group - the UK's fifth largest energy supplier - is expected to reveal pre-tax profits for the six months to 30 September rose 50% to £417m.

Source: BBC News