Rebels in new bid to thwart BE

REBEL investment group Polygon has threatened legal action against British Energy in the latest twist in the battle over the nuclear power generator.

Polygon said this weekend that it was considering a legal challenge to derail the energy company's plans to delist its shares and sell its assets just one day before a crucial shareholder meeting.

Polygon, a US hedge fund, has been fighting British Energy's £5bn restructuring plan. It was given the go-ahead last week for an extraordinary general meeting on October 22 that would have given shareholders a chance to stop the board delisting and selling assets.

But British Energy, headed by Chairman Adrian Montague, instantly moved to apply to delist the company on October 21, one day before the meeting.

Polygon, which owns a 5.6% stake, had said that even if the company delisted, it could still prevent it from selling its assets and changing the deadline. But Financial Mail has learned that BE is also planning to sign an agreement with its creditors, including banks and bondholders, to extend the deadline for restructuring before the meeting. It is planning to transfer all its assets to a new company on October 21.

'It is going to be a very busy day,' said a British Energy source. 'But we can't afford to be put into a box by Polygon.'

BE is spending this weekend drafting the listing particulars for the new company. It will call an extraordinary meeting for its shareholders to vote on the restructuring. But it has said that if they vote down the restructuring, creditors-will seek the repayment of £1.5bn of debt, sending the company into administration.

Polygon is now threatening to take out an injunction to stop BE from transferring the company's assets. That would give shareholders a chance to prevent the move on October 22.

The US hedge fund manager who made a quick killing buying BE shares earned a staggering £283m last year. David Tepper's Appaloosa investment company netted more than000 £1m from trading in BE shares earlier this year.