SSE sells SGN stake for £1.2bn as energy firm completes disposals
Energy firm SSE has today sold off its entire stake in Scotia Gas Networks (SGN) for £1.2bn as it completes its £2bn disposal programme.
The FTSE 100 firm said that a consortium comprising existing SGN shareholder Ontario Teachers’ Pension Plan Board and Brookfield Super-Core Infrastructure Partners would buy out its 33.3 per cent stake.
Shares in SSE rose 1.7 per cent today.
SGN distributes gas to nearly 6m households and businesses across Scotland and the south of England.
The sale is the largest of a series of disposals SSE has made over the last year as it pivots away from energy supply and distribution and towards renewable generation.
Last year it sold off its household energy business to challenger supplier Ovo for £500m, and shed its energy from waste assets for £1bn.
In addition, it has sold off its North Sea oil and gas assets, taking the total realised from the disposal programme to £2.7bn.
Proceeds from today’s sale will go towards reducing SSE’s £8.9bn debt pile, as well as its investment plans.
Finance director Gregor Alexander said that although SGN was a “strong business”, it had become “purely a financial investment” for the FTSE firm, and it was thus the right time to sell it.
SSE initially bought half of SGN back in 2005 for £505m. It sold a third of that initial stake to Abu Dhabi Investment Authority (ADIA) in 2016.
Alexander added: “Completion of our disposals programme will leave SSE more streamlined and strategically aligned than ever before, with a business mix that is very deliberate, highly effective, fully focused and well set to prosper on the journey to net zero and beyond.”