German energy firm RWE could sell Britain's Npower: report

3rd July 2011, Comments 0 comments

Germany's second largest power company, RWE, may sell Npower, one of Britain's biggest electricity suppliers, in a deal worth £5 billion, a report said Sunday.

RWE was considering the sale because it has large debts, needs to invest billions in a new generation of green power stations and also because of "dissatisfaction" with British energy policy, the Sunday Times said.

Spanish power group Iberdrola is a likely buyer for Npower, which employs 11,000 people and supplies electricity to around 6.8 million homes in Britain, the newspaper said, citing insiders.

Npower made profits of £245 million (271 million euros, $394 million) on sales of £7 billion last year.

RWE has hired Goldman Sachs to review Npower's future, the Sunday Times reported.

Conservative Prime Minister David Cameron's coalition government, in power since May 2010, is reviewing its energy policy to encourage investment in nuclear and wind power and penalise old fossil fuel plants.

© 2011 AFP

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