FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
28 November 2002
BRITISH ENERGY PLC
(Registrant's name)
3 Redwood Crescent
Peel Park
East Kilbride G74 5PR
Scotland
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form 20-F..X.. Form 40-F.....
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ..... No ..X..
If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b):
Exhibit Index
The following document (bearing the exhibit number listed below) is furnished
herewith and is made a part of this Report pursuant to the General Instructions
for Form 6-K:
Exhibit Description
No. 1 RNS Announcement, re: Announcement of Restructuring
dated 28 November 2002
No. 2 RNS Announcement, re: New Chairman Announcement
dated 28 November 2002
No. 3 RNS Announcement, re: Statement re Pension Scheme
dated 28 November 2002
Exhibit No.1
British Energy plc ("British Energy" or the "Company")
Announcement of restructuring proposals and extension of HMG loan facility
The Board of British Energy (the "Board") announces a restructuring intended to
achieve the long-term financial viability of the British Energy Group. The
restructuring will require certain significant creditors of the British Energy
Group to compromise their claims and will lead to very significant dilution of
existing shareholders. The UK Government ("HMG") has confirmed its intention to
support the proposed restructuring and has agreed to extend the facility
agreement (the "Facility"), entered into on 26 September 2002, until 9 March
2003 in order to provide financial stability and security whilst British Energy
seeks the support of these significant creditors.
The principles for restructuring include:
- British Energy has entered into non-binding Heads of Terms with BNFL,
which will provide for two new contracts to replace the agreements under
which BNFL currently provides front and back-end fuel related services to
British Energy Generation Limited ("BEG") and British Energy Generation (UK)
Limited ("BEG(UK)"), British Energy's wholly-owned UK nuclear generating
subsidiaries
- All uncontracted nuclear liabilities, decommissioning liabilities of the
nuclear power stations owned by BEG and BEG(UK) and the historic liabilities
relating to spent fuel will be met through a Nuclear Liability Fund ("NLF").
British Energy will make ongoing contributions to this fund and HMG has
agreed to assume financial responsibility for such liabilities to the extent
that they exceed the assets in the NLF
- British Energy would issue new bonds to significant creditors, together
with new ordinary shares, in exchange for the extinguishment of existing
obligations they are owed. British Energy would also issue new bonds to the
NLF.
- Under the proposed restructuring, the Board will not issue more than
GBP700 million in new bonds of which GBP275 million will be contributed
to the NLF
- The NLF will also receive a contractual entitlement to receive 65 per
cent. of the net cash flow of the British Energy Group (after tax, financing
costs and transfer to cash reserves)
- As a result of the restructuring, existing shareholders of British Energy
are expected to be very significantly diluted
- Ordinary trade creditors and employees are expected to be paid in full as
the relevant amounts fall due
- British Energy is continuing discussions with potential buyers for its
interests in Bruce Power LP ("Bruce") and Amergen
The restructuring plan will need to be approved by the significant creditors
whose entitlements are to be compromised, HMG, existing shareholders (if
required), the Inland Revenue and the European Commission (under State Aid
Rules) prior to being finally implemented. This is expected to be completed by
mid 2004 and only then can the restructuring be fully implemented. Prior to 14
February 2003, the Board will seek to agree formal standstill arrangements and
agreement in principle to the proposed restructuring with the significant
creditors. An application for Restructuring Aid must be submitted to the
European Commission prior to 9 March 2003.
The Board believes that the proposed restructuring outlined in this announcement
is in the best interests of the Company and its creditors and is working closely
in conjunction with its advisors to implement a successful restructuring of
British Energy within the principles accepted by HMG.
The Board believes that the restructuring of the group offers the best available
opportunity to achieve the long term financial viability of the British Energy
Group. However, the proposed restructuring requires the Company to reach formal
agreement with a large number of creditors with respect to diverse financial
interests, as well as a successful disposal of British Energy's interests in
Bruce and Amergen.
If such agreements cannot be reached, the required approvals are not forthcoming
within the timescales envisaged, the assumptions underlying the proposal are not
fulfilled or the conditions to the restructuring are not satisfied or waived,
the Company may be unable to meet its financial obligations as they fall due and
therefore the Company may have to take appropriate insolvency proceedings, in
which case the distributions to unsecured creditors may represent only a small
fraction of their unsecured liabilities and there is unlikely to be any return
to shareholders.
Contacts:
Andrew Dowler Tel: 0207 831 3113
Financial Dynamics
British Energy plc ("British Energy" or the "Company")
Announcement of restructuring proposals and extension of HMG loan facility
Introduction
The Board of British Energy (the "Board") announces a restructuring intended to
achieve the long-term financial viability of the British Energy Group. The
restructuring will require certain significant creditors of the British Energy
Group to compromise their claims and will lead to a very significant dilution of
existing shareholders. The UK Government ("HMG") has confirmed its intention to
support the proposed restructuring and has agreed to extend the facility
agreement (the "Facility") entered into on 26 September 2002, until 9 March
2003, in order to provide financial stability and security whilst British Energy
seeks the support of these significant creditors.
Implementation of the restructuring proposals is subject to material conditions,
including approval by the European Commission under State Aid Rules.
The Board believes that the proposed restructuring outlined in this announcement
is in the best interests of the Company and is working closely in conjunction
with its advisers to implement a successful restructuring of British Energy in
accordance with the principles accepted by HMG.
Background
At the Company's AGM on 16 July 2002, the Chairman stated that commercial
conditions in the UK electricity market were tough. On 13 August 2002, the
Company revised its forecast UK nuclear generation for the year to 31 March 2003
to be in the region of 63 TWh (plus or minus 1 TWh) compared with the originally
planned generation of 67.5 TWh. This revision was largely based on unplanned
outages at the Company's Torness, Heysham, and Dungeness B nuclear power
stations.
British Energy had for some while been seeking to renegotiate its fuel contracts
with BNFL to try and significantly reduce its fixed cost base. BNFL delivered,
on 3 September 2002, its final proposal to British Energy, but the terms that
they offered fell short of those which British Energy required. Having reviewed
the longer-term prospects of the group, the Board concluded that it should not
drawdown on existing undrawn loan facilities and decided that there was no
alternative but to seek HMG support. On 5 September 2002, British Energy
announced that it had initiated discussions with HMG with a view to seeking
immediate financial support and to enable a longer term restructuring to take
place.
As a result of these discussions, on 9 September 2002 HMG provided British
Energy with a facility for up to GBP410 million which was due to mature on 27
September 2002. The facility was intended to provide working capital for
British Energy's immediate requirements and to allow the Company to stabilise
its trading position in the UK and North America.
On 26 September 2002, HMG agreed to a revised facility in an amount of up to
GBP650 million and with a maturity date of 29 November 2002. The Facility was
cross-guaranteed by certain principal group entities and secured by certain
group assets. It also contained a requirement to provide further first ranking
and fixed and floating charge security to HMG if so requested.
Since 26 September 2002, the Company and its advisers have been considering the
financial prospects of the business and working on proposals for a solvent
restructuring which would address the significant cash shortfalls arising in the
business expected in the short to medium term in light of the current market
environment.
In particular, the proposed restructuring seeks to address the following
factors:
- British Energy's nuclear fleet in the UK has high fixed costs of
production (including costs of existing contracts with BNFL); as a result
the business has been unable to withstand the reduction in wholesale
electricity prices which have fallen by over 35 per cent. over the last two
years.
- British Energy, as a merchant generator with no retail supply business, is
heavily exposed to declines in wholesale electricity prices. British Energy
has built significant direct sales to industrial and commercial customers,
but the contracts are closely linked to the wholesale electricity price.
- British Energy's wholesale electricity price exposure has been exacerbated
by a power purchase agreement and two contracts for differences which have
magnified its exposure to baseload electricity prices.
- British Energy has an obligation, under its nuclear licences, to
decommission its stations at the end of their useful life. Certain of the
decommissioning liabilities are covered by the Nuclear Decommissioning Fund
("NDF") to which British Energy contributes; however, there is no certainty
that this fund will be sufficient to cover all of the liabilities to which
it relates. In addition, other substantial decommissioning liabilities are
currently unfunded. Therefore, the amount of the decommissioning
liabilities is subject to uncertainty.
- British Energy's operations generate liabilities in respect of nuclear
fuel and waste. Some of these liabilities are covered by long term
contracts with BNFL, with the balance remaining uncontracted. These
uncontracted liabilities are long term in nature and therefore subject to
uncertainty. There is no guarantee that the business will generate
sufficient funds to cover these liabilities.
- British Energy's coal plant at Eggborough has also suffered from the
reduction in wholesale electricity prices and the narrowing in the
differential between winter and summer prices. The plant is worth
significantly less than the debt it carries.
- British Energy has successful investments in the USA and Canada but these
have not generated dividends to British Energy to date. As a result they
have stretched British Energy's financial resources. These investments are
now for sale.
- Based on unaudited management accounts, as at 30 September 2002, British
Energy had indebtedness of GBP1,050 million (including GBP490 million
secured on the Eggborough plant). The Company's funding needs have
increased significantly in both the UK and Canada to meet the collateral
needs of trading counter-parties, following the loss of its investment
grade rating in September 2002.
HMG Facility
The GBP650 million Facility will be extended at its existing level until 9 March
2003, to continue to provide working capital for the business and collateral to
support the trading operations in the UK and North America. To date,
approximately 60 per cent. of the Facility has been drawn down.
Continued financing under the Facility will be conditional on British Energy
promptly using all reasonable efforts to obtain formal standstill commitments
from certain Significant Creditors (see below), and the Secretary of State will
be entitled to require immediate repayment of the Facility if such creditors
decline to enter into these commitments by 14 February 2003 or if British Energy
Generation (UK) Limited's ("BEG(UK)") interest in Bruce Power LP ("Bruce") is
not sold by 14 February 2003 or if in the opinion of the Secretary of State the
restructuring cannot be implemented in the manner or timescale envisaged.
Discussions in relation to the possible disposals of BEG(UK)'s interests in
Bruce and Amergen are continuing. HMG's funding commitment in respect of Bruce
will be restricted, pending agreement of the proposed sale of Bruce in the short
term, subject to review by the Secretary of State in the light of progress on
the sale of Bruce.
Under the Facility, cash proceeds from any disposal of BEG(UK)'s interests in
Bruce and Amergen and net cash flow from operations of British Energy and its UK
subsidiaries (excluding Eggborough) after deduction (in the case of cashflow) of
approved UK capital and operating expenses, are required to be applied first in
repayment of the Facility and associated expenses and secondly in establishing
and maintaining cash reserves for the purposes of providing collateral for
trading and operations, covering lost revenue and costs from outages and meeting
other working capital requirements.
As the cash reserves build up, the available amount of the Facility will be
reduced. If the cash reserves were to reach GBP490 million, no further
borrowings under the Facility are envisaged and any such borrowing would
require the consent of the Secretary of State.
The Facility will remain cross-guaranteed by principal group entities other than
Bruce and secured by certain group assets. (see note below)
HMG notified its initial financial support and its extension of the Facility to
the European Commission on 9 and 27 September 2002. On 27 November 2002 the
European Commission granted approval of this aid until 9 March 2003.
On 22 November 2002, Greenpeace were granted leave to commence proceedings for a
judicial review of the rescue aid inherent in the Facility.
Standstill Agreements
British Energy will immediately seek to enter into formal standstill agreements
with BNFL and other significant finance creditors ("Significant Creditors")
comprising holders of the 2003, 2006 and 2016 sterling bonds (together the "
Bondholders"), the Eggborough bank syndicate (the "Bank Lenders") and
counterparties to three out of the money power purchase agreements and contracts
for differences: Teesside Power Limited (TPL), TotalFinaElf (TFE) and Enron
(collectively the "PPA Counterparties").
Under the proposed standstill agreements, Significant Creditors would be paid
only an element of the amounts owing to them. In particular, the British Energy
Group would pay interest but not principal on amounts owing to the Bondholders
and the Bank Lenders. British Energy Power and Trading Limited ("BEPET") would
pay to Eggborough Power Limited ("EPL") amounts attributable to its operating
costs, capital expenditure and interest on borrowings. Each PPA Counterparty
would be paid interest on overdue standstill amounts. In addition, TPL would
receive certain payments in respect of some of its operating and energy costs.
British Energy has had preliminary discussions with certain of the Significant
Creditors who have indicated a willingness, in principle, to enter into such
standstill arrangements.
In addition, BNFL has agreed in principle, subject to the arrangements with
other creditors, to standstill all payments for storage and reprocessing until
31 March 2003 and thereafter to accept reduced payments for spent fuel services
until the restructuring is completed ("Restructuring Closing Date").
British Energy expects to continue to pay ordinary trade creditors and employees
as the relevant amounts fall due.
The restructuring proposal envisages British Energy reaching formal standstill
agreements and agreement in principle on the restructuring with Significant
Creditors by 14 February 2003.
Agreement with BNFL
British Energy, BEG(UK) and British Energy Generation Limited ("BEG"), have
entered into non-binding Heads of Terms with BNFL in relation to BNFL's supply
of fuel and related fuel services for future burn (front-end and back-end). The
new contracts are conditional upon the restructuring proposals being
implemented. The existing back-end contracts between BEG, BEG(UK) and BNFL will
continue to apply in respect of fuel loaded into reactors prior to the new
contracts becoming effective. Pending formal implementation of the new
contracts, payments from British Energy to BNFL shall be made as if the new
contracts had become effective on 1 April 2003.
The principal terms of the new contracts, which will cover the expected life of
British Energy's nuclear plants, will be:
With respect to front-end fuel fabrication services:
- a payment of GBP28.5 million fixed per annum until 2006, but discounted on a
variable basis in accordance with electricity prices to a minimum of GBP13.5
million at a market price of GBP15/MWh. The fixed starting price falls to
GBP25.5 million per annum thereafter and is also subject to the discounting
mechanism
- a payment of GBP191,000 per tonne of AGR fuel delivered
With respect to back-end fuel services:
- a payment of GBP150,000 per tonne of AGR fuel, payable on irradiation of the
fuel
- a rebate/surcharge against that payment equivalent to 50 per cent. of the
difference between the market baseload price in a year and GBP16.00 per MWh
multiplied by the MWh produced by the AGR fleet in that year. The market
baseload price used in the calculation will not be less than GBP14.80 and
not more than GBP19.00
- if the market baseload price exceeds GBP19.00 per MWh, a surcharge against
that payment equivalent to 25 per cent. of the difference between the market
baseload price in a year and GBP19.00 per MWh multiplied by the MWh produced
in the AGR fleet in that year. The market baseload price used in that
calculation will not be less than GBP19.00 and not more than GBP21.00
- BNFL will assume title to spent fuel on delivery to BNFL from British
Energy
All of the above monetary amounts are indexed to the Retail Price Index ("RPI").
British Energy intends that the definitive contracts are executed before 1 April
2003.
Nuclear liabilities and the decommissioning fund
As at 30 September 2002, British Energy's unaudited management accounts
contained, on a discounted basis, an accrual of approximately GBP2.1 billion for
liabilities in respect of British Energy's back-end contracts with BNFL, which
extend to 2086, and provisions of approximately GBP0.7 billion for uncontracted
back-end liabilities and approximately GBP0.6 billion (net of the NDF) for costs
of decommissioning which may take as much as eighty years from the start of
defuelling to complete. Under the restructuring, the existing NDF would be
enlarged into or supplemented by a new fund (the "Nuclear Liability Fund")
covering these historic spent fuel liabilities and uncontracted back-end
liabilities as well as costs of decommissioning.
The value of the present NDF on the balance sheet at 30 September 2002 was
GBP0.3 billion based on unaudited management accounts. Pending implementation
of the restructuring, payments to the NDF will continue on the existing basis.
After the Restructuring Closing Date, British Energy will contribute to the NLF/
NDF, as appropriate:
- fixed decommissioning contributions of GBP20 million per annum (indexed to
RPI) but tapering as stations close
- GBP150,000 (indexed to RPI) for every tonne of fuel loaded into the Sizewell
B reactor after the Restructuring Closing Date
- GBP275 million of new bonds (see below)
- 65 per cent. of free cash flow (see below)
Subject to approval of the restructuring and the compromise with Significant
Creditors set out below, HMG will meet the costs of historic back-end fuel
liabilities and will assume responsibility for uncontracted and decommissioning
liabilities to the extent that the accrued value of the NDF and the
contributions by British Energy to the NLF (as set out above) are insufficient
to meet the liabilities as they fall due. Any surplus would be applied towards
the costs borne by HMG in respect of historic back-end fuel contracts. The
average annual cash cost to British Energy of meeting the historic back-end fuel
costs to be assumed by HMG would have been approximately GBP150 million to
GBP200 million per annum over the next ten years, declining thereafter.
The fixed decommissioning contributions will be accelerated on a net present
value basis (discounted at a discount rate appropriate to the fund) and become
immediately due and payable in the event of the insolvency of BEG or BEG(UK).
The accelerated payment will be guaranteed by all principal group companies and
secured by charges on their assets.
Restructuring Process
The arrangements described above represent the contributions which HMG and BNFL,
respectively, are willing to make to facilitate a restructuring of British
Energy. British Energy believes that financial viability can only be achieved
if certain other existing creditors of the British Energy Group also agree to
make a contribution to the restructuring by agreeing to a compromise of their
existing claims. Based on unaudited management accounts at 30 September 2002,
the Significant Creditors whose claims will need to be compromised are:
(GBPm)
Bondholders 408
Bank Lenders (1) 490
PPA Counterparties 365
____
1,263
(1) Excludes any valuation of associated interest rate swaps
The Bondholders are creditors of British Energy but also have a joint and
several guarantee from BEG and BEG(UK). Enron is a creditor of BEG and has a
guarantee from British Energy; whilst the other PPA Counterparties (namely,
Teesside Power Limited and TotalFinaElf) are creditors of BEPET and likewise
have guarantees from British Energy. Amounts owing by EPL to the Bank Lenders
are not guaranteed by British Energy but British Energy guarantees the payment
of amounts by BEPET to EPL calculated to cover EPL's borrowing and operating
costs and British Energy also provides a subordinated loan facility to EPL.
Under the restructuring, the Significant Creditors will be asked to extinguish
their existing claims in exchange for a combination of new bonds and new
ordinary shares in the restructured British Energy Group. The amounts that are
expected to be offered to each class of creditor will likely depend on not only
the amount each such class claims is owing to them but also other factors
including the identity of the debtor and any guarantor. In addition, at the
Restructuring Closing Date new bonds will be issued to the NLF and thereafter a
proportion of annual free cash flow will be contributed to the NLF.
New bonds
Under the restructuring proposal the par value of new bonds to be issued will
not exceed GBP700 million.
The actual amount of the new bonds to be issued and the number of tranches or
classes thereof will be determined following a detailed review of the level of
debt that the business is capable of supporting in light of the financial
position of the business at the time when the restructuring is implemented.
The financial robustness of the business will be supported by cash reserves of
up to a maximum of GBP490 million to cover collateral and working capital
requirements of the business and lost revenue and costs in relation to outages.
The terms of the new bonds are yet to be finalised. However, they are presently
expected to be divided into a number of tranches amortising on an annuity basis,
the overall redemption of which is expected to match closely the remaining
useful economic life of the power stations. Consequently, the new bonds are
expected to mature on or before 2035 and to carry a fixed coupon of
approximately 7% per annum. Application will also be made for Listing on the
Official List. In due course, British Energy may seek to have one or more
rating assigned to the new bonds. Prepayments or purchases of the new bonds will
only be permitted if British Energy at the same time prepays on a pro rata basis
part of the net present value of the decommissioning contributions for the
ensuing five years.
If the maximum amount of GBP700 million in new bonds were issued, the Board
would issue GBP275 million to the NLF with the remaining GBP425 million being
issued to Significant Creditors.
Nuclear Liability Payments
The British Energy group will also make contributions ("Nuclear Liability
Payments") to the NLF of 65 per cent. of the group's consolidated net annual
cash flow after tax, financing costs and the funding of the Cash Reserves up to
GBP490 million. For these purposes, financing costs includes payment of interest
and repayment of principal. The percentage used to calculate the Nuclear
Liability Payments will be adjustable on a fair and reasonable basis so that
shareholders benefit from retained cash flow and proceeds of new subscriptions
for shares and so that the NLF and shareholders are not adversely affected by
any demerger, issue of securities to shareholders or other corporate actions.
The NLF will have the right, from time to time, to convert all or part of the
Nuclear Liability Payments into such number of ordinary shares in the
restructured group as would represent after full conversion the same percentage
of the share capital as the percentage used to calculate the Nuclear Liability
Payments prior to conversion (i.e. 65 per cent. at the current time).
For so long as they are held by the NLF such ordinary shares would be non-voting
to the extent that they would otherwise carry 30 per cent. or more of the voting
rights of the restructured company.
New Equity
In addition, Significant Creditors are expected to be issued with new ordinary
shares, thereby very significantly diluting existing British Energy shareholders
(including holders of A shares).
Conditions
The restructuring proposal is conditional on, inter alia:
- Completion of a sale of British Energy's interest in Bruce by 14 February
2003
- A sale of British Energy's interest in Amergen having been agreed by 30
June 2003 and completed by the Restructuring Closing Date
- Formal agreement to the restructuring proposals having been entered into
by BNFL, the Bank Lenders, TPL, TFE and Enron by no later than 30 September
2003
- The restructuring proposals having been approved by meetings of the
bondholders by 30 September 2003
- Receipt of State Aid approvals to the restructuring proposal by 30 June
2004 (or such later date, not being later than 30 September 2004, or as the
Secretary of State may agree)
- Admission of the new ordinary shares and new bonds to listing by the UKLA
- Shareholder approval if required
- All necessary regulatory approvals and tax clearances
Documentation to approve the restructuring is expected to be issued in the
summer of 2003. The European Commission approval of any restructuring aid
application is expected by mid-2004.
The Government assistance to the restructuring proposals is subject to State Aid
approval. Once the plan has agreement in principle from Significant Creditors
the Government will notify the plan to the European Commission for approval.
The decision of the European Commission is expected by mid 2004.
Bruce/Amergen
As previously announced, British Energy is currently in discussions with
potential buyers for its interests in Bruce and Amergen, which are respectively
a subsidiary and an associate of BEG(UK). Any proceeds from disposal will be
applied first in respect of repayment of the Facility and second in respect of
the cash reserves noted above. The restructuring proposal assumes that Bruce
will be sold by 14 February 2003 but there cannot be any assurance that this
will be achieved.
Restructured business
Following completion of the restructuring process, British Energy will be a
merchant generator in the UK market with nuclear generating facilities and the
Eggborough coal-fired power station with a combined capacity of 11.6 GW. Output
will continue to be sold into the wholesale power market or under arrangements
with energy supply companies.
The Board intends to reduce the Group's exposure to wholesale electricity prices
in the UK. The revised BNFL contract will provide a partial hedge against
market prices in respect of approximately 40 per cent. of British Energy's total
electricity output (including Eggborough and Sizewell). In addition, the Board
intends to implement a trading strategy which will seek to enter into short and
medium-term power-sale contracts with market counterparties and with industrial
and commercial customers, to hedge the majority of its remaining output.
While the company is targeting annual output from the nuclear power fleet of
approximately 69 TWh (82 per cent. load factor), the Board considers that a
prudent judgement of the normal level of output from these plants on an annual
basis should be 67TWh (80 per cent. load factor).
In addition, under the proposed restructuring, the exposure of the group to the
uncertainty and long term risks inherent in the group's uncontracted and
decommissioning liabilities and substantial historic liabilities to BNFL would
be limited to the amount of the notes issued to the NLF and the ongoing Nuclear
Liability Payments and fixed decommissioning contributions.
As a result of the restructured BNFL contracts, cash operating costs (including
maintenance capital expenditure and overheads (including corporate overheads))
in the nuclear operations, on an assumption of 67 TWh output and at electricity
prices of GBP16 per MWh (in 2002/3 prices), are expected to be approximately
GBP14.50 per MWh (in 2002/3 prices).
Taking account of the needs of the restructured business, the Board intends to
take action to reduce corporate overhead costs.
Other Considerations
The legal structure and the steps necessary to implement the proposed
restructuring, together with their accounting and tax consequences, have not
been finalised. Implementation of the proposed restructuring will require the
identification of a structure and steps which permit the commercial and economic
effects outlined above to be achieved without material adverse taxation or
accounting consequences.
The detailed terms of the restructuring will also need to be discussed and
agreed with the Inland Revenue. Formal agreements will need to be reached with
Bondholders, the Bank Lenders, TPL, TFE and Enron in relation to the standstill
and the restructuring of their diverse financial interests. No agreement has
been reached in relation to the price or terms of any sale of Bruce or Amergen.
Furthermore the European Commission may not approve the restructuring or may
impose conditions to such approval that would affect the financial terms or even
the viability of the restructuring.
If such agreements cannot be reached or the required approvals are not
forthcoming within the timescales envisaged, or the assumptions underlying the
proposal are not fulfilled, or the conditions to the restructuring proposal are
not satisfied or waived, then the Company may be unable to meet its financial
obligations as they fall due and therefore the Company may have to take
appropriate insolvency proceedings. The Board considers that, in the event of
insolvency, distributions, if any, to unsecured creditors may represent only a
small fraction of their unsecured liabilities and there is unlikely to be any
return to shareholders.
Interim results
The Company expects to announce its results for the six months to 30 September
2002 on 12 December 2002.
Contacts:
Andrew Dowler Tel: 0207 831 3113
Financial Dynamics
Notes:
1. The loan is guaranteed by British Energy plc, British Energy
Generation (UK) Limited, British Energy Generation Limited, British Energy Power
and Energy Trading Limited, British Energy Investment Limited, District Energy
Limited, British Energy International Holdings Limited, British Energy US
Holdings Inc., British Energy L.P., British Energy (Canada) Limited and Bruce
Power Investments Inc.
2. Security for the HMG Facility has been given by British Energy plc
(fixed and floating charge debenture and share pledge), British Energy Power and
Energy Trading Limited (fixed and floating charge debenture), British Energy
Generation Limited (fixed and floating charge debenture and fixed charge over
nuclear sites), District Energy Limited (fixed and floating charge debenture),
British Energy Generation (UK) Limited (fixed and floating charge debenture,
charge over nuclear sites and share pledge), British Energy International
Holdings Limited (fixed and floating charge debenture and share pledge), British
Energy (Canada) Limited (the holding company of the group's Canadian Interests)
(share pledge), British Energy Investment Limited (fixed and floating charge
debenture) and British Energy US Holdings Inc., (the holding company of the
group's United States interests) (share pledge).
Exhibit No.2
28 November 2002
BRITISH ENERGY PLC
NEW CHAIRMAN APPOINTED
British Energy PLC announces the appointment of Adrian Montague CBE as its
Chairman.
He replaces Dr Robin Jeffrey, 63, who has stepped down from his position as
Chairman and Chief Executive. Dr Jeffrey became Chairman and Chief Executive in
2001, prior to which he was responsible for the company's successful overseas
investment programme. The Board would like to record its appreciation of his
commitment to British Energy but, with the blueprint for a solvent restructuring
now agreed with the Government, it has decided that someone with a different
skill set should head the company.
Mr Montague, who is joining British Energy with immediate effect, said:
"British Energy's situation is well known. The impact of falling prices in the
generation market and the fixed nature of its current cost base means that a
restructuring is urgently required. I believe that can best be achieved in the
private sector and that British Energy can have a viable future as a privately
financed company. In the short term, that is what I am determined to achieve.
In the long-term, British Energy needs to reclaim its rightful position as one
of the UK's leading generators."
As previously announced, headhunters have been appointed to help identify a new
Chief Executive, and a further announcement will be made in due course.
Notes for Editors
Adrian Montague is Deputy Chairman of Network Rail and a senior adviser to
Societe Generale, Paris. From 1997 to 2001, he held senior positions concerned
with the implementation of the Government's strategy for involving the private
sector in the delivery of public services, first as Chief Executive of the
Treasury Taskforce, and then as Deputy Chairman of Partnerships UK plc. Adrian
joined the Treasury Taskforce from Dresdner Kleinwort Benson where he was
Co-Head of the merged Global Project Finance businesses of Kleinwort Benson and
Dresdner Bank. He was with London law firm Linklaters & Paines from 1971 to
1994, becoming a partner in 1979. Adrian is also non-executive Chairman of
Michael Page International plc and of Partnerships for Health plc, and a
director of CellMark AB, the pulp and paper marketing company based in
Gothenburg.
For further information: Andrew Dowler
Financial Dynamics
020 7831 3113
Exhibit No.3
BRITISH ENERGY GENERATION GROUP PENSION SCHEME: DISCONTINUANCE OF USE OF SURPLUS
The Board of British Energy announces today that it has discontinued the
existing use of the BEGG pension scheme surplus with effect from 1 November,
two months earlier than indicated in the previous announcement of 8 October.
The additional cash cost to the Company associated with the bringing-forward of
the cessation date is not expected to exceed GBP4.5m.
CONTACTS
Paul Heward 01355 262201 (Investor Relations)
David Wallace 01355 262574 (Media Enquiries)
Duty Press Officer 01452 652233 (Media Enquiries)
Find this News Release on our web-site: www.british-energy.com
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: November 28, 2002 BRITISH ENERGY PLC
By:____Paul Heward____
Name: Paul Heward
Title: Director - Investor Relations