AN investor in British Energy (BE) last night gave up its attempt to derail the group's Government-backed debt restructuring package.

Polygon Investment Partners said it believed there was no longer any commercial logic in trying to prevent BE delisting its shares and extending the time limit for agreeing the rescue deal, which expires in late January.

British Energy's largest nuclear power plant is in Hartlepool.

The decision means Polygon will vote against its own resolutions at a meeting next month that it called together with another institutional investor, Brandes Investment Partners - whose intentions remained unclear yesterday.

The two investors had called the meeting after voicing opposition to BE's £5bn debt restructuring deal, which has been approved by the European Commission.

They said the package, which would give creditors control of the company in a debt-for-equity swap, would leave them and other shareholders with an unnacceptably small stake.

But BE said the agreement, which will reduce investors' holding to 2.5 per cent, was its only option.

The company warned it would face administration if shareholders succeeded in derailing the package, leaving them with nothing.

BE has already applied to delist its shares from the stock market.

BE said it had dropped its legal action against Polygon in the US that it began after the investment group called the meeting.