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. Last Updated: 07/27/2016

Centrica Soars After Report U.K. Won't Block Gazprom

LONDON -- Shares of Centrica, Britain's largest energy provider, rose as much as 6.4 percent on reports the British government would not block a takeover attempt by gas giant Gazprom.

Though the Department of Trade and Industry has considered legislating to protect the security of British energy supplies, Prime Minister Tony Blair opposes interfering, the Financial Times reported Wednesday, without saying where it got the information. Centrica shares rose 18.4 pence (32 cents), or 6.2 percent, to 313.25 pence midmorning in London.

Gazprom deputy CEO Alexander Medvedev said Tuesday that Centrica was on Gazprom's "watch list." The company has not entered into "concrete talks" on such a bid, he said. The British government said in February that it might block a bid from Gazprom for Centrica because the company is partly owned by the state.

"Any takeover by any company in the U.K. would be subject to scrutiny from the competition authorities," said Nick Turton, a spokesman with the Department of Trade and Industry.

Alan Duncan, the shadow secretary for trade and industry in the opposition Conservative Party, said on April 24 that Gazprom should "play by the rules" if it wants to buy Centrica.

Gazprom, which supplies one-quarter of Europe's gas, cut shipments of the fuel to Ukraine in January during a dispute over prices. Gas deliveries to European Union countries including Italy, Hungary and France got cut off as well.

Centrica's profit margins have shrunk as the cost of natural gas soared. The Windsor, England-based company has to buy the fuel in the wholesale market. The company is worth £11.3 billion ($20.2 billion).