NOMURA CHALLENGES US FIRMS IN BATTLE FOR ENERGY GROUP

NOMURA CHALLENGES US FIRMS IN BATTLE FOR ENERGY GROUP

Nomura, the leading Japanese bank, challenged two U.S. companies Wednesday in a multibillion-dollar takeover battle for Energy Group, the British-based electric utility and coal producer.

Nomura's interest in Energy Group provides the first direct challenge to a trans-Atlantic invasion that has left more than half of Britain's electricity distribution under U.S. ownership. European power firms, with the exception of Nordic utilities, have shown little interest in cross-border acquisitions.If Nomura is successful, it would also get control over nearly 10 percent of the U.S. electricity supply which comes from Peabody Coal, a unit of Energy Group.

The U.S. bidders are PacifiCorp. of Portland, Ore., whose bid of 3.6 billion pounds ($5.95 billion) for Energy Group last June has been snared in twin Anglo-American regulatory probes, and Dallas-based Texas Utilities, which declared its interest on Monday.

If one of the U.S. bids is successful, it will bring eight of the 12 regional electricity suppliers in England and Wales under American control. U.S. firms have spent 7.8 billion pounds ($12.87 billion) on the seven firms since the British industry was privatized in 1990.

U.S. companies like Amerada Hess also have moved into the gas industry.

Energy Group, whose British unit Eastern Electric is the country's largest regional electricity distributor, the fourth-largest electricity generator and the second-largest gas supplier, is known to favor the PacifiCorp. bid.

PacifiCorp. is the parent of Pacific Power & Light and Utah Power & Light, and supplies electricity to 1.3 million customers in California, Idaho, Montana, Oregon, Utah, Washington and Wyoming.

U.S. firms have used Britain, which was the first country in Europe to liberalize its power industry, as a springboard into the Continent. Enron Corp., a Houston-based electric utility formed a joint power generating venture with Enel SpA, Italy's state-owned utility, to exploit openings in the European market. Southern Co., which moved into Britain in 1995, last year took control of Bewag AG, Berlin's power utility.