Scottish Power names new CEO; shares see largest gain since May

Scottish Power Plc, the U.K. utility that rejected a $20 billion takeover bid from E.ON AG in November, said Thursday that its new chief executive officer will be Philip Bowman, who last year sold liquor maker Allied Domecq Plc.

Bowman replaces Ian Russell and starts in four days, the company based in Glasgow, Scotland, said in a statement. Scottish Power shares had their biggest jump since May as the appointment fueled speculation the German utility may make a new bid. Jonathan Smith, an E.ON spokesman in Coventry, England, declined to comment.

Under Russell, who on Nov. 22 called E.ON's 570 pence ($10) a share bid too low, Scottish Power shares have trailed competitors such as Scottish & Southern Energy Plc. Bowman, 53, the former CEO of the U.K. drinks maker, sold Allied Domecq to Pernod Ricard SA in July for $13.3 billion after a monthlong bidding contest.

"Perhaps this clears the way for further discussions with E.ON," said Fraser McLaren, an analyst with ING Groep NV in London, who has a "sell" recommendation for the stock. "The arrival of a new CEO provides some alternatives."

Scottish Power declined to make Russell available for comment.

Shares of Scottish Power climbed as much as 25 pence, or 4.6 percent, to 568 pence. That's the biggest gain since May 24, when it agreed to sell its PacifiCorp unit — the parent company of Utah Power — to a utility controlled by billionaire Warren Buffett for $5.1 billion, about half of what the company paid for the business.

The stock ended trading Thursday up 16 pence, or 3 percent, to 559 pence in London. The shares had their biggest drop in a year on Nov. 22, the day talks ended with E.ON. Shares of the German utility rose 1.4 percent to 90.22 euros in Frankfurt.

Bowman joined Allied Domecq as group finance director in 1998 and was appointed CEO in August 1999, according to the company's Web site. He's a former director of Bass Plc and has worked as an accountant.

Scottish Power is "on track to deliver strong results for the full year," the company also said Thursday in the statement. Its cash sale of PacifiCorp is "proceeding on schedule," it said.

Russell was Scottish Power finance director in 1999, when the company paid $10.7 billion to purchase PacifiCorp. MidAmerican Energy Holdings Co., a utility owner controlled by Buffett, last month reached settlements with Idaho and Oregon consumer groups over its proposed purchase.

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Contributing: Mark Deen; Meera Bhatia; Kimberly Kirner