Mr Fischer is also chief executive of WestLB, the German bank which is tipped to handle the share offer.Analysts said that it made sense for RWE to re-invest the proceeds in the electricity and gas markets where profit margins are higher because of soaring wholesale energy prices.But RWE would not be the first company to discover that a multi-utility strategy did not work. ScottishPower itself bought Southern Water, only to sell it off subsequently at a £1bn loss.Thames Wasser accounts for 18 per cent of RWE's turnover and made a €619m (£420m) operating profit in the first half of the year. In the UK, Thames Water has 8 million water and 13 million sewage customers and has been given permission by the industry regulator to raise bills by a quarter over the next five years to an average of £261 per household. RWE, which already owns Npower, has all but ruled itself out of an offer for ScottishPower but analysts believe it could bid for Centrica, the owner of the British Gas brand.According to reports from Germany yesterday, the RWE board is due to meet on Friday to approve the spin-off of Thames Wasser, as it is now known. Thames Wasser is the parent company for both Thames and American Water Works.It is not clear where the flotation would take place, although bankers said a listing in London or New York was more likely than one in Frankfurt.RWE bought Thames for £6.8bn in 2000 in a move which valued the company at a record price. It followed up the deal with the £4.2bn acquisition of American Water Works a year later in September 2001.A spokesman for RWE refused to comment on the planned re-listing of Thames. However, he added: "RWE regularly reviews its portfolio of businesses and its strategy in light of developments in the market place."The idea of spinning off Thames is said to have been hatched by Thomas Fischer, the chairman of RWE's supervisory board.
Thames Water, the UK's biggest water company, is to be floated on the stock market again in a deal which is likely to value the business at about £9bn. RWE, the German utility which owns Thames and American Water Works, the largest water company in the US, is planning to list up to 30 per cent of the two businesses through an initial public offering, raising about £3bn. News of RWE's plans immediately sparked renewed speculation that it may bid for a UK energy company. She owns nearly 7 per cent of the company, worth about £30m.SCi beat off competition from Elevation Partners, the private-equity vehicle that has the U2 frontman, Bono, among its investors, to secure Eidos for £103m in shares in May.. "The business is the publisher of proven multimillion-selling units," Mr Gibson said.
SCi, which owns the Conflict war games series, also owns Eidos's Hitman computer games as well as the Tomb Raider series.Bidders are likely to have to pay a significant premium for the company, given its back catalogue of hits, and a takeout price may have to be near 700p a share.Any takeover would land SCI's chief executive, Jane Cavanagh, with a substantial windfall. Apax Partners, the private-equity business, is also thought to be considering a bid for SCi.Nick Gibson, of Games Investor Consulting, which advises the computer games industry, said yesterday the combined SCi and Eidos business had become an attractive target. Shares in the group, which bought its rival Eidos, the creator of Lara Croft, five months ago, jumped 25 per cent to 600p, giving it a market capitalisation of £432m. Rival games publishers including Midway, the US group that is controlled by Viacom's Sumner Redstone, and Electronic Arts, the world's largest games publisher, are thought to be the interested parties. We will remain a law-abiding entity." She played down fears about a new draft law that some analysts fear could hit TNK-BP hard. The legislation would allow only companies that are majority Russian-owned to bid for certain oilfields deemed to be of "strategic importance".
