DOMINION Resources, the US group, yesterday agreed a £1.3 billion sterling bid for East Midlands Electricity, one of only five remaining British independent regional electricity companies.

But East Midlands shares languished well below the 670p per share offer price, as concerns emerged the bid might face obstacles from British competition authorities.

Dominion said last week it was considering a bid "at a price not much in excess of 608p per share". But East Midlands had rejected that price.

"Everyone's expecting the" MMC (Monopolies and Mergers Commission) to take a close look at the deal. That is why the shares are only trading around 630p, said one trader.