Government to sweeten nuclear auction - newspaper

LONDON, April 13 (Reuters) - Britain may try to make a number of nuclear sites currently up for auction more attractive to buyers by including assets owned by up-for-sale British Energy (BGY.L: Quote, Profile, Research), the Sunday Times said.

The move would ease fears that the eventual buyer of BE will have total control of the country's nuclear power industry, which is enjoying a renaissance after the government sanctioned the building of a new fleet of stations.

The Nuclear Decommissioning Authority (NDA), which owns 18 sites, including two with operational reactors, said last month its assets were now up for sale.

Two weeks later British Energy, which runs power stations on its own sites, said it was in takeover talks. The new set of nuclear stations are highly likely to be built on the NDA and BE sites.

The government is keen to avoid competition problems by making sure the two site portfolios go to different companies. The NDA offering is said to be of a lower quality, but adding BE sites to the mix may encourage a loser in the fight for BE to bid for the NDA sites as a consolation.

The government could not be reached for comment.

The battle for British Energy heated up last week as sources familiar with the matter said both Germany's RWE (RWEG.DE: Quote, Profile, Research) and France's EDF (EDF.PA: Quote, Profile, Research) were prepared to bid a little under 700 pence a share for the group, valuing it at 11 billion pounds.

British Gas-owner Centrica (CNA.L: Quote, Profile, Research) made an all-share proposal, while Spain's Iberdrola (IBE.MC: Quote, Profile, Research), Germany's E.ON EONG.DE and Sweden's Vattenfall VATN.UL could come in at a later date.

The British government indirectly holds a 35 percent stake in the company, and is likely to play a crucial role in the outcome of the battle.

British Energy declined to comment. (Reporting by John Bowker, editing by Will Waterman)