Firms warm up for power bid

Linklaters & Paines and Freshfields are the main firms acting in the National Power recommended £2.8 billion bid for Southern Electric, the biggest yet in the industry.

Linklaters' team for National Power is led by Tim Clarke with corporate partner Patrick Rignell and competition partner Bill Allan. Freshfields team for Southern is led by partners Philip Richards, Graham Nicholson and Simon Evans.

Shareholders are to vote on the deal, which will create a leading company in power generation, supply and distribution.

Other generators which have made 'vertical integration' bids for regional electricity companies (RECs) are Scottish Power with its hostile £1.1 billion bid for Manweb and Powergen with its £1.9 billion bid for Midlands Electricity.

Tim Clarke said: “What is different about this transaction compared with other M&As is that every transaction in the electricity industry involves two regulators – the Office of Fair Trading and the Office of Electricity Supply.

“The next stage will be to draft the offer document. This will be simpler than most because it is a recommended offer and it is a pure cash offer – albeit with a Loan Note alternative – and so listing particulars will not be written.”

Linklaters has acted for National Power since its creation in 1990.

Linklaters is also advising on National Power's disposal of three coal-fired power stations. Among the three bidders is the Eastern Group REC, recently acquired by Hanson.

Linklaters now has substantial electricity experience. This year it advised Trafalgar House on its hard-fought but unsuccessful bid for Northern Electric and acted for bankers SBC Warburg, which advised Southern Electric International in its bid for the South Western REC.

Freshfields acts for its long-standing client Powergen in its bid for the Midland REC.