UPDATE 1-France's GDF Suez eyes International Power-papers
(Changes dateline, adds details, background)
PARIS/LONDON Jan 17 (Reuters) - French utility GDF Suez (GSZ.PA) is eyeing a tie-up with Britain's International Power IPR.L, with the Sunday Times saying a takeover bid is on the cards, while France's Wansquare said the link would take another form.
Rumours about a GDF approach for International Power have been around for months and on Friday, when International Power shares hit a 15-month high, both companies declined comment.
A spokesman for GDF Suez did not return calls on Sunday.
International Power has a market value of some 5 billion pounds ($8.17 billion) and rose 20 percent in the past three months, while GDF Suez has an equity value of 64 billion euros ($92.33 billion).
The Sunday Times said talks intensified in the weeks before Christmas with direct calls between Gerard Mestrallet of GDF Suez and International Power chief executive Philip Cox.
The paper said GDF has appointed Rothschild, BNP Paribas (BNPP.PA) and Goldman Sachs (GS.N) to work on the deal while International Power had not yet appointed an adviser.
Wansquare said Rothschild et Associes banker Gregoire Chertok was working on the transaction.
Instead of a cash or paper bid for the group, there could be another transaction involving assets "less costly and yielding immediate synergies," the online news service said.
Wansquare is a joint venture of the Le Figaro newspaper and the Journal des Finances.
The U.K. power group delivers energy under contract to some 4 million households. It has 45 power plants in Europe, the United States, Asia and the Middle East.
The French state has a 35.6 percent stake in GDF Suez which was formed through the 2008 merger of Suez and state-owned gas group GDF. Belgium's GBL (GBLB.BR), controlled by Albert Frere, has a 5.3 percent stake.
GDF Suez has a limited presence in Britain but is the world leader as Independent Power Producer, the number one electricity group in Belgium and second in France behind EDF (EDF.PA). It is the number five producer and supplier of power in Europe and the number one importer and buyer of LNG gas.
EDF has branched out to Britain with its 12.5 billion pound buy of British Energy last year. (Reporting by Marcel Michelson; Editing by Erica Billingham)
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