British Energy has eight nuclear plants across the UK
British Gas owner Centrica has said it is buying a 20% stake in nuclear firm British Energy for £2.3bn.
Centrica had first agreed a £3.1bn deal with British Energy's French owner EDF last summer, and this would have seen it take a 25% stake.
However, talks on the deal had dragged on after electricity prices fell.
EDF's £12.5bn takeover of British Energy, which runs eight UK nuclear power plants, was concluded in January of this year.
Centrica and EDF plan to build four new nuclear plants on existing sites as part of the the UK government's plans for the country to get more of its electricity from nuclear generation.
BRITISH ENERGY'S NUCLEAR PLANTS
Hinkley Point B
Analysts say it is this likely expansion that makes British Energy such an attractive investment.
In a statement, Centrica said: "The deal should be positive for both customers and investors - it lowers our exposure to energy price volatility."
EDF said the deal would enable Centrica to take part in the re-launch of nuclear energy in the UK.
The deal is subject to regulatory approval but Centrica said it did not anticipate any problems.
Centrica said that EDF would purchase its 51% stake in Belgian electricity generation firm SPE for £1.2bn. The balance of the deal would be paid in cash, it said.
EDF is the world's biggest operator of nuclear power stations.
When EDF's move to take over British Energy was first announced, critics questioned whether it made sense to transfer control of a sensitive industry to a firm that was 85%-owned by the French government.
EDF already has in place plans to build four nuclear reactors at Hinkley Point in Somerset and Sizewell in Suffolk. The first is due to begin operating by the end of 2017.
British Energy's eight existing power stations are Dungeness B, Hartlepool, Heysham 1, Heysham 2, Hinkley Point B, Hunterston B, Sizewell B and Torness.
They currently generate around 14% of the UK's domestic energy supply.
Centrica also said that its residential business had a strong start to the year following increased demand for gas and electricity during winter cold snaps in the US and UK.
Investors welcomed the deal, sending Centrica shares higher in morning trade. Its shares were up 3.6%, or 8.25 pence, at 235.75p - making it the third biggest gainer on the FTSE 100 index.
Neil Woodford, head of investment at Invesco Perpetual, said the move was a major step forward for Centrica.
"The partnership with EDF also promises to be a driving force in revitalising the UK nuclear industry - a vital project if the UK is to meet its long-term climate change obligations and energy security needs," Mr Woodford said.
"Centrica has negotiated a good price for the deal package which will create a more vertically integrated and more balanced business in an environment of volatile international energy prices."