Centrica, the owner of British Gas, is seeking to acquire Belgian's second biggest electricity supplier but will have to match a "substantial" bid from EdF, the French state energy giant, according to sources in Paris.

They suggested EdF could offer a premium of between five and 10 per cent in an attempt to knock Centrica out of the race.

The British group wants to take control of Société de Production d’Électricité (SPE) in a sale ordered by the European Commission as a condition for approving the €100 billion (£79 billion) merger between GdF, the French state gas group, and Suez, the Franco-Belgian utility.

GdF was told by the Commission to shed its 25.5 per cent stake in SPE, which it bought for €247 million in 2005.

Centrica, which also owns 25.5 per cent of SPE, says it plans to exercise its pre-emption rights on GdF's shares in a move to expand its operations in mainland Europe.

Jean-François Cirelli, the chairman of GdF, told analysts that he expected an offer from EdF this week.

"Centrica has to equal the bid if it is to acquire the stake," said a GdF spokeswoman.

A source close to the negotiations denied that there was a plot between the two French state energy groups to keep Centrica out of the Belgian market.

"GdF has a duty to its shareholders to sell to the highest bidder," the source said.

SPE, which trades as Luminus, has 1.5 million customers in Belgium and is regarded as a bridgehead into the lucrative French market.

Local authorities in Belgium control 49 per cent of SPE.

The battle for the Belgian group comes as GdF and Suez plan to conclude their tie-up next month after two and half years of false starts and wrangles.

The merger will create a European electricity and gas giant to rival EdF and Germany's E.ON, with sales of €74 billion and a combined enterprise value of €105 billion.

It will also give rise to the world's second biggest water and waste management group - behind France's Veolia - when Suez spins off its environment division to form Suez Environment.

The merger will involve an exchange of 21 GdF shares for 22 Suez shares, effectively privatising the state gas supplier, but leaving the French state with 35 per cent of the merged company.

Suez shareholders will acquire 65 per cent of the environment division - receiving 0.25 shares in Suez Environment for every Suez share they own.

Suez-GdF will retain a 35.4 per cent stake in Suez Environment for at least three years under a pact with core shareholders, which will hold about 12 per cent.

Suez and GdF are to call shareholder meetings to vote on the scheme on July 16 and plan to launch the merged group less than a week later.

It will be headed by Gérard Mestrallet, the chief executive of Suez, who has overcome hostility from politicians, unions, shareholders and European rivals to drive through the scheme first mooted by Dominique de Villepin, then French Prime Minister, in February 2006.

The initial plan for a merger of equals, which was designed to block a takeover of Suez by Enel, the Italian energy group, ran into opposition from President Sarkozy and from Suez's investors.

Mr Mestrallet agreed to spin off his environment business to win their support.

Brussels gave the go-ahead on condition that the two groups shed assets in Belgium, where Suez has signed a deal, which will give control of Distrigaz, the gas supplier, to Italy's Eni, for €2.7 billion.