Groundhog day

After the spectacular failure of Railtrack, bondholders might be forgiven for thinking that the British government would not let another former public utility go to the wall. But as Philip Moore discovers, investors in British Energy are experiencing a sense of déjà-vu

For a government to bungle the rescue of one privatised company might seem like bad luck. To do it a second time just over a year later smacks of sheer carelessness at best, rank incompetence at worst. That, at least, is what some bondholders, still licking their wounds after the 2001 Railtrack fiasco, think about the downfall of British Energy and the British government’s involvement in it.

At the end of November, British Energy unveiled a series of debt restructuring proposals approved by the