The proposed merger of SSE and Npower’s retail businesses has been scrapped.
SSE said its board and that of Innogy’s had been unable to agree revised commercial terms.
Many in the market had suggested the deal was dead after SSE flagged problems last month.
SSE said it will now look at other options and potentially other buyers for its domestic retail business.
“The transaction has been impacted by multiple factors including the performance of the respective businesses, clarity on the final level of the default tariff cap, changing energy market conditions and the associated implications of these for both the joint business plan and the market in which the business would be operating,” SSE stated.
“These implications meant the new company would have faced very challenging market conditions, particularly during the period when it would have incurred the bulk of the integration costs.”
SSE chief executive, Alistair Phillips-Davies, added:
“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.”
See details here.
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