Centrica shuns loan market for EDF deal

Centrica, the UK utility and owner of British Gas, will not tap the loan market to fund its £2.3bn acquisition of a 20% stake in British Energy, the nuclear power company. Instead, the cash element of the deal, totalling £1.1bn, will be financed using proceeds from Centrica’s £2.31bn rights issue completed in December. This comes despite the fact that the company turned to banks at the end of last year, seeking to raise a club loan of about £1bn to back the purchase.