SSE sinks as subsidiary sale falls through
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The price of shares in FTSE 100 energy firm SSE (LON:SSE) dropped by 2.42% to 1,063.10p after it announced that the sale of its energy services subsidiary had fallen through. SSE and Innogy had been unable to agree on revised commercial terms and management said that they did not believe that it was in the best interests of stakeholders to proceed with the deal.
The company still intends to separate the energy services arm, but said that it would be profitable in the 2018/19 and 2019/20 financial years. Chief executive Alistair Phillips-Davies said: “This was a complex transaction with many moving parts. We closely monitored the impact of all developments and continually reviewed whether this remained the right deal to do for our customers, our employees and our shareholders. Ultimately, we have now concluded that it is not. This was not an easy decision to make, but we believe it is the right one.
“SSE Energy Services remains a profitable business with a strong track record, a customer-centric culture and an excellent team that has enabled it to be a market-leader for many years. We will build on this while continuing with separation activity in preparation for its long-term future outside the SSE group.
“We are now exploring all the available options with a view to delivering this future in the best possible way. In this, the interests of our customers, employees and shareholders remain paramount. In the meantime, we remain strongly committed to high standards of service for customers and delivery of our five-year dividend plan for shareholders.“
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