Bord Gáis formally kicked off the first of what will be two bidding rounds for its energy division, which the State-owned company intends to sell by the end of the year.

The group formally announced yesterday that it has begun the sale of its energy division, which supplies electricity and natural gas to businesses and consumers, opening the door to potential bidders.

It will be providing possible suitors with an information memorandum, detailing exactly what is for sale and how that business has been performing, from next week.

There will be two bidding rounds for the business. The second is likely to get under way by the end of the summer and a deal should be done before the year is out.

British group, Centrica, which is known to be interested in the entering he Irish market, French utility GDF Suez and German operator Eon, have all been named as likely purchasers.

Some reports have suggested that Bord Gáis Energy could sell for as much as €1.4 billion, but industry sources believe that €1 billion is at the upper range of what the business is likely to fetch.

The group’s finance director, Michael G O’Sullivan, described yesterday’s announcement as a milestone.