ScottishPower terminates offer talks

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United Kingdom, Nov. 23, 2005 -- Talks between ScottishPower and E.ON on a possible E.ON buy out of the UK-based power company have been terminated. ScottishPower's board, on the advice of Morgan Stanley and the United Bank of Scotland, rejected E.ON's final offer for ScottishPower shares.

E.ON's final proposal to ScottishPower was at 570p per ScottishPower share, which ScottishPower thought would not have been accepted by shareholders earlier than the spring of 2007, when any transaction was expected to complete. The Board, which received independent financial advice from Morgan Stanley and UBS, concluded that the proposal did not reflect the fair value of ScottishPower and its prospects. In providing their advice, Morgan Stanley and UBS have relied upon the commercial assessments of the directors of ScottishPower. Accordingly, the board has rejected this final proposal and discussions have ceased.

E.ON initially announced it was considering making an offer for ScottishPower on Sept. 5 and made its first approach to ScottishPower on Sept. 26. Over recent weeks the Board of ScottishPower has been engaged in extensive discussions with E.ON to see if it was possible to reach agreement on an offer for ScottishPower that reflected fair value for their shareholders and had a high degree of deliverability.

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