The ESB is expected to make a binding bid next Friday for a cluster of eight electricity supply companies in Poland.

It is thought the State power company will need significant debt to fund its acquisition of the G8 group of firms if its bid is successful.

Based in the industrial city of Gdansk and further south, the companies have annual revenues of about #970 billion (£764 billion). Its customers make up about 16 per cent of the Polish market.

The firms could be worth almost the same as the ESB itself, whose current net asset value is #1.8 billion.

Sources said the last power supply company privatised in Poland, GZE, was sold to the Swedish firm Vattenfall at a rate equivalent to #567 per customer. That very rough rule of thumb would value the G8 companies - with 2.5 million customers - at #1.42 billion.

Given the likely scale of a deal, it is thought the ESB would fund such an acquisition with debt from Irish and international banks.

The company is expected to face rival bids from significant players in the European utilities industry. These are: Endesa and Iberdrola of Spain; Electrabel of Belgium; Eon of Germany; and the Polish group Elektrim.

It is thought the Polish authorities plan to choose a preferred bidder by August.

Sources claimed the rejection of the Nice Treaty by Irish voters was not seen as a significant factor. Poland is among the former Eastern Bloc countries whose entry to the EU is envisaged by the treaty.

While sources accepted the vote had "raised the profile of Ireland in a negative sense", they said the company had already spent significant time in Poland preparing for its bid. It has studied the market since early 1999 and opened an office in Warsaw last year.

The project is the largest yet planned by the ESB's international division.

It also plans to construct a power generation station in Spain's Basque region and another at Coolkeeragh, Co Derry. Such businesses are seen as crucial to the company's strategy as it faces competition in the domestic market. It aims to retain 60 per cent of the Irish power market when it is fully liberalised after 2005.

The ESB chairman, Mr Tadhg O'Donoghue, has said the company needs five years preparation before a possible flotation. Any debt would be taken into consideration when the company is valued on the stock exchange.