SSE Energy Services Transaction08 Nov 2018
SSE plc and Innogy SE have entered into discussions and are working together regarding potential changes to the commercial terms of the proposed combination of SSE Energy Services and npower Ltd (“the new company”) and listing of the new company on the Main Market of the London Stock Exchange. These discussions are expected to take place over several weeks, and an update on their progress will be provided by mid-December. SSE does not intend to provide further comment on the discussions until that update.
It is likely that completion of the proposed combination will be delayed beyond Q1 of 2019, but all work to seek to achieve the formation and listing of the new company will continue.
Since taking up her appointment on 24 September, the Chief Executive Designate of the new company, Katie Bickerstaffe, has been leading the work being done to prepare for the listing of the new company. It has since become apparent that the impact of some recent market developments mean that the commercial terms associated with the proposed combination will need to be reconsidered.
These developments include the potential impact of the level of the Default Tariff Cap on, amongst other things, the new company’s requirements to post collateral against its credit exposure and its ability to obtain and retain an appropriate credit rating. Potential changes to the commercial terms of the proposed combination of SSE Energy Services and npower Ltd would be designed to mitigate the impact of these developments, while taking full account of the interests of customers, employees and shareholders.
Alistair Phillips-Davies, Chief Executive of SSE plc, said:
“We continue to believe that creating a new, independent energy supplier has the potential to deliver real benefits for customers and the market as a whole, and that remains our objective.
“In assessing potential changes to the commercial terms of the proposed SSE Energy Services/npower combination, the interests of customers, employees and shareholders will be paramount.
“In the meantime, our skilled and committed SSE Energy Services team continues to be focused on providing a high standard of service to our customers.”