Shares in British Energy have more than doubled despite assurances from the electricity generator that it had no explanation for the increase.
The surge gathered pace after the announcement, leaving the financially- stricken group with a closing price of 10.25p, a rise of almost 30pc on the day.
Latest movement came as reports said a US hedge fund was buying shares. Reasons are unclear, particularly as British Energy shareholders look set to be left only a fraction of the company after a planned debt-for-equity restructuring.
The share price rise of recent days is still insignificant in terms of the overall value of the company, which has seen its stock tumble from a high of 325p in 2000.
The generator, which employs 430 people at Hartlepool Power Station and supplies one-fifth of the UK’s power, narrowly escaped administration in October before the agreement of banks and bondholders to write off pounds 1.3bn in debt. At the same time as ruling out any reason for the share price rise, British Energy said it had settled a lengthy dispute with German engineering company Siemens.
Under the agreement British Energy will get pounds 18.3m to cover problems at its Heysham plant in Lancashire after work in the 1990s by the ex-Siemens’ business Parsons.
British Energy said the settlement included a commitment by the company and Siemens to develop a long- term supply agreement.
