Investors sent British Energy shares up 5% yesterday after the company confirmed that potential bidders are valuing it at least £10.8bn.

Among the companies thought to have put a takeover or other proposals to the East Kilbride-based company is ScottishPower owner Iberdrola via a consortium with Germany company RWE.

Iberdrola declined to comment yesterday but industry sources reckon it is definitely interested in participating in the UK nuclear energy industry in some way.

Also in the frame is France's EDF and Suez. Suez is thought to have submitted proposals short of a takeover over.

Industry sources indicate that Scottish Gas owner Centrica is not one of those that has submitted a bid, although it has been in talks with the nuclear power operator.

The company submitted an indicative all-share offer earlier in the year but has been hobbled by its falling stock price as gas prices leapt.

British Energy confirmed yesterday, in a statement to the stock exchange, that it has received a range of from proposals from "several parties" wanting to make an offer for the company, including the 35% stake held by the government.

"These include proposals priced higher than the company's closing share price on 15 May 2008," it added. This would place them upwards of £10.8bn.

It said discussions would be continuing with all those parties.

"The board wishes to stress that each of the proposals requires further development and that the process is therefore likely to continue for a number of weeks," it added.

British Energy is attractive to potential bidders because it owns eight nuclear reactors which are potential sites for a new generation of nuclear power stations the government is keen to see built.

British Energy shares closed up 35.5p, a 5.2% gain, at 715.5p, as hopes emerged of a bidding war for the utility. They had been declining since reaching a high of 785p on April 25, as investors feared there could be just one bid (from EDF) pitched as low as 650p a share.

Suez's position is complicated by the fact it is in the midst of a merger with Gaz de France. It is thought that it may be content with a deal that allows it to take some part in constructing new power stations rather than taking over British Energy.

Iberdrola has also shown some ambivalence about the process warning firmly last month, when bids were being discussed around the 700p mark, that it wouldn't enter at prices that high.

In a sign of EDF's determination to begin develop- ing nuclear power stations in Britain, it is understood to have already bought plots in Somerset and Anglesey, next to existing power stations at Wylfa and Hinkley Point, which are large enough to provide space for one of its European pressurised reactors.