The buyout would add 1.1 million customers to SingPower’s bulging Australian electricity and gas network, which includes SPI Powernet, the high voltage network that services both generators and distributors in Victoria.

TXU Australia owns the Western Underground gas storage facility, the Torrens Island Power Station in South Australia and a third of the SEAGas pipeline.

The ACCC previously foiled SingPower's attempts to purchase electricity distributor and retailer Citipower in 2002, only giving approval for the acquisition of the company's distribution assets, the poles and wires.

Potential buyers are now hoping the ACCC will force SingPower to divest SPI Powernet or the merchant arm of the TXU Australian business.

Of chief concern to the ACCC is that SingPower will end up controlling the full energy supply chain from generation to retail resulting to a ‘reaggregation of the old SEC’ according to ACCC chairman Graeme Samuel.

In Singpower’s defence is the heavy regulation of the energy market which means that its downstream business could not secure a deal any different to those available to the competitors.

However, if pushed into a sale of some of its assets to create room for the purchase of TXU it is thought that the Singaporean player could make a tidy profit from Powernet, which it purchased in 2000 for $2.1 billion, but is now valued at $2.5 billion.

Analysts had estimated the value of the TXU unit to be between $4.1 billion and $4.7 billion. The $5.1 billion price-tag includes $2.9 billion of debt.

Late last year TXU's Texan parent company had planned to float the Australian unit, which had been one of the best-performing divisions in the TXU stable.

However TXU opted for a trade sale because of the good price offered by Singapore Power, which had trumped a previous offer from the Hong Kong based CLP.

The ACCC is expected to hand down its decision in a few weeks.