French energy giant Electricite de France (EDF) is to purchase British Energy Group after both boards agreed on a price following months of negotiations, EDF said Wednesday in a statement.

According to the agreed deal, EDF will pay 12.5 billion pounds (15.7 billion euros, or 22.9 billion dollars) for the group, which owns eight of Britain's 16 nuclear power reactors.

The offer, equal to 774 pence per share of British Energy, represents a premium of more than 35 per cent over its closing middle price on March 14, when talks began between the two companies, and of nearly 7 per cent over Tuesday's closing middle price.

The two companies had been in talks since spring, but EDF's original offer of 765 pence per share was rejected by two investment funds that together controlled 22 per cent of the company.

While unions representing EDF workers are opposed to the deal, judging it too costly and risky, investors welcomed it, bidding up EDF shares by 3.75 per cent, to 52.03 euros in afternoon trading on the Paris Bourse.

The deal was also welcomed by British Prime Minister Gordon Brown, who called it "significant step towards the construction of a new generation of nuclear power stations."

The British government, which has a 36-per-cent share in British Energy, is set to bank a multibillion-pound windfall from the deal and is looking to upgrade its nuclear energy sector.

The government says that Britain's existing 16 nuclear power stations, which currently provide 20 per cent of the country's energy needs, are scheduled to close over the next 20 years.

"New nuclear is becoming a reality," Brown told Sky News television.

In its statement, EDF said the takeover would enable it to become an active player in the British nuclear industry. It said it plans to build four EPR-type nuclear power stations in Britain.

In a press conference in Paris, EDF head Pierre Gadonneix said that Britain "is a key market for EDF with an enormous need for new nuclear power stations."

Parts for the first two EPR reactors have already been ordered, Gadonneix said. The first of the new nuclear power stations is scheduled to go into operation at the end of
2017.

Addressing the fears of trade unions, the EDF chief said, "Britain will be the European nation that will commit itself the most to the development of nuclear energy."

As a result, the purchase of British Energy would produce higher turnover and profits for EDF from the first year, he said.

EDF has targeted Britain, China, the United States and South Africa as the four markets in which it is looking to expand its nuclear energy business.

British Energy chairman Adrian Montague also praised the deal, saying, "This new transaction is regarded by the board as good for the shareholders, good for our staff, good for the nuclear industry and also good for the country."

"EDF is a huge supplier of nuclear energy in France, and of course we have been a big supplier in the UK and together we want to build a new nuclear future," he said.

However, anti-nuclear campaigner Greenpeace criticized the deal, which the environmental group said would do nothing to promote energy security or tackle climate change.