The board of British Energy will meet today to consider a takeover approach from EDF, the French state-owned electricity group, but board members, who include Sir Adrian Montague, chairman, and Bill Coley, chief executive, are minded to hold out for a higher offer.

EDF was the only company to have submitted a detailed offer by a preliminary deadline of last Friday. The exact offer price is not known but it is believed to be about 650p a share.

The board will discuss EDF’s offer at a scheduled board meeting today and tomorrow in London. Sources close to the situation said that the Government, which owns a 35.2 per cent stake, is eager to ensure a competitive auction for British Energy, whose eight nuclear and one coal-fired power stations generate a sixth of the UK’s electricity.

It is hoped that one or more bids could materialise. Suez, of France, RWE, of Germany and Iberdrola, of Spain, all remain interested but missed a deadline set by Rothschild, the investment bank handling the sale.

Centrica, the owner of British Gas and the only other UK company involved in the bidding process, also remains keen to play a role, most probably as a potential junior partner to buy sites from a successful bidder.

However, Centrica, whose falling share price has dented its ability to mount a solo bid, is also believed to be keeping its options open. A recovery in its own valuation might create a fresh opportunity for the group actively to participate.

Contributing to the debate today will be Pascal Colombani, a former director of EDF and Areva, the French nuclear reactor maker, who has served on the board of British Energy since 2003.

There is also pressure to resolve the ownership issue quickly. British Energy is expected to play a key role in the drive to build a new generation of nuclear reactors in the UK through its ownership of most of the present nuclear sites.

The Government is keen to have the ownership issue resolved by the time that Parliament rises in July because it wants to use the sale of its stake as an opportunity to kick-start the new build programme.

There are concerns that a drawn-out auction could delay the detailed planning and construction phases that will be necessary.

The Government is insisting that any buyer of British Energy would have to sell off some key sites to ensure proper competition in the process.

British Energy shares closed at 678½ yesterday, valuing the company at just over £7 billion

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