British Gas owner Centrica will this week sound out shareholders about reviving plans for a £22bn all-share merger with British Energy, it was reported yesterday.

British Gas owner Centrica will this week sound out shareholders about reviving plans for a £22bn all-share merger with British Energy, it was reported yesterday.

Centrica is pondering its options following the last- minute collapse on Friday of the £12bn takeover of the nuclear generator by state-owned French giant EDF.

Centrica would have taken 25% of British Energy - which produces one-sixth of the UK's electricity and runs the Hunterston and Torness stations in Scotland - had the EDF deal gone ahead. The merger plan, mooted earlier this year, was resisted by British Energy shareholders, not least the government which is desperate to turn its 36% stake into cash for the blighted public finances.

Centrica will meet its investors to showcase its controversial £992m half-year profits - unveiled a day after British Gas announced a record 35% hike in gas bills and a 9% rise in electricity bills.

The firm is said, however, to be ready to press ahead only with the explicit backing of its shareholders and the government, which owns a 36% stake in British Energy.

EDF's 765p-a-share offer for the utility was set to be announced on Friday but is understood to have been scuppered by the opposition of two institutional investors, Invesco with 15% and M&G with 7%, who are holding out for a higher price.