The government moved quickly yesterday to offload 25% of British Energy, as it attempted to learn from past mistakes on its timing of share sales.

Just two days after announcing that it would cut its holding in the nuclear generator from 64% to 39%, the Department of Trade and Industry said it had sold the stake at 520p a share, raising £2.08bn.

Under an accelerated book-built offering, a total of 400 million shares were placed with institutional investors, with a further 50 million shares or 3% to be sold if an over-allotment option is exercised. A DTI spokesman said the stock placement was oversubscribed by a "healthy" amount, but was unable to specify by how much.

The proceeds are intended to be used to help fund the eventual decomissioning costs of the company's existing nuclear power plants.

Some City analysts had expected the government to have to stall on the share sale because of market sensitivities. The DTI is in the middle of its energy review, which is likely to give the green light to a new generation of nuclear plants. That, however, would have the most impact on British Energy, which has the only sites where new power stations could gain planning approval.

Trade and Industry Secretary Alistair Darling, a strong candidate for Chancellor in Gordon Brown's Cabinet, appears to have moved quickly to avoid a repeat of what the market saw as ham-fisted Treasury timing in 2006.

Brown announced his decision to raise cash from British Energy in his Budget last year, at a time of sky-high valuations for energy stocks, but the Treasury did not move quickly enough to cash in, and market reaction to the stock overhang helped push British Energy shares down by more than a third.

The stock has staged a rally in recent months on the back of reassurances over maintenance issues at its oldest stations including Hunterston B in Ayrshire.

Even so, the sale was at a discount of almost 10% to the level the stock was trading at earlier this week before the DTI's initial announcement.

The government has held a "shadow stake" in British Energy since it prevented its collapse into bankruptcy in 2002. As part of its restructuring, the Nuclear Liabilities Fund had rights to about two-thirds of the company's cashflows, and it is these that have been up for auction.

Standard & Poor's said yesterday that its ratings and outlook on British Energy remained unaffected by the sale.