UPDATE: EDF:Centrica To Pay GBP2.3 Billion For 20% Of British Energy

Electricite de France SA (EDF.FR) said Monday it has sold 20% of its British Energy nuclear power subsidiary to Britain's Centrica PLC (CAN.LN) for GBP2.3 billion.

The price is at a 6% discount to that which EDF paid for British Energy, EDF said.

The companies have been negotiating the transaction since shortly after state-controlled EDF bid GBP12.5 billion for British Energy late last year.

Centrica was originally expected to buy 25% of British Energy, but lowered its sights following difficult talks over price.

EDF said the companies will also form a joint venture, in which the French utility group will hold 80%, to build four nuclear power stations in the U.K.

EDF said it will buy Centrica's 51% stake in Belgian power generation and supply group SPE for EUR1.3 billion, leaving net cash proceeds to EDF from the two transactions at equivalent to EUR1.2 billion.

Under the transaction, which is expected to be completed toward the end of third quarter, Centrica will buy 20% of Lake Acquisitions, the vehicle through which EDF bought British Energy. Centrica will also assume 20% liability for the contingent guarantees given by EDF via contingent value rights issued by Lake as part of the British Energy acquisition.

EDF will take 80% of the power generated by British Energy's fleet of plants, with Centrica taking the remainder. EDF said it will also provide Centrica with 18 terawatt hours of power at market prices over five years beginning in 2011.

Company Web site: www.edf.com; www.centrica.com

By A.H. Mooradian, Dow Jones Newswires; +33 1 4017 1740; art.mooradian@dowjones.com.

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