Powergen, the UK's third-largest electricity generator, which is being acquired by Germany's E.ON fo...
Powergen, the UK's third-largest electricity generator, which is being acquired by Germany's E.ON for $14bn, said third-quarter profit rose 5.3% as a US acquisition boosted sales.
Net income in the three months through September rose to £60m, or 9.1p a share, from £57m, or 8.6p a share, in the year-earlier period, the company said in a statement on Regulatory News Service. Sales rose 48% to £1.4bn.
Powergen completed the $5.4bn acquisition of Kentucky's LG&E Corp in December to reduce its exposure to the UK, where falling prices ate into profits.
Around the end of October, the shares were trading at 744.5p, below the E.ON offer price of 765p, indicating that some investors may not expect the offer to gain regulatory approval.
The agreement, which last month received approval from the US Federal Energy Commission, still needs to be sanctioned by the US Securities and Exchange Commission and the European Commission.
On 6 November, Powergen announced that Progress Energy, the owner of utilities in North Carolina and Florida, had agreed to buy two of its power plants in Georgia for $345m to boost power sales in the US Southeast.
Powergen will get cash for the Monroe plant near Atlanta and the Tiger Creek project under construction in central Georgia. Progress will also assume payment of the $165m Powergen owes to Tiger Creek contractors, Progress spokesman Keith Poston said.
Progress agreed to sell power from the Georgia plants to Powergen through 2004, instead of selling it in the open market, to ensure steady revenue. Wholesale electricity prices in the US have fallen this year because of the economic slump and a host of new generation projects.
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