SSE has completed the sale of its household business to Ovo Energy for £500 million, with 8,000 members of staff transferring from the Perth-based company.
The Scottish firm will receive £400 million of cash up-front, with Ovo paying a further £100 million through loan notes before 2029 at 13.25% interest. The deal leaves SSE free to concentrate on generating renewable energy and operating electricity networks, while upgrading Ovo from a “challenger” business in the energy industry to a major player.
SSE had intended originally to merge its household business with that of Npower, but the deal was abandoned in December 2018 after the UK Government introduced its energy price cap, despite winning regulatory approval. Instead, SSE unveiled a replacement deal with Ovo last September.
Alistair Phillips-Davies, chief executive at SSE, said: “The sale is in line with our clear strategy, centred on developing, operating and owning renewable energy and electricity network assets, along with growing businesses complementary to this core. SSE enters the new decade as a more focused group, even better positioned to lead the low carbon transformation required to achieve the UK’s vital net zero commitment in the years to come.”
