Utility news
On this page you will find industry news about electricity, renewable energy, gas, water, fixed and mobile telecoms, and other stories. Our news is updated once per month. We cover items such as developing technologies, price changes in the utility markets, takeovers and company collapses, changes in tariffs, the results of investigations by the regulators and market trends.
Please take time also to visit our Business Cost Consultants news page, where we will keep you up to date with developments in Business Cost Consultants, and coverage we have had in news and trade press.
If you would like to be kept up-to-date with utility news, you can join our list of free monthly newsletter subscribers; just go to the Newsletter sign-up page. You can unsubscribe at any time.
- See the Newsletter sign-up page.
Industry news
SS&E the 'front-runner' in £2bn auction for Energia
Sunday, July 13, 2008
Scottish & Southern Energy is running the rule over a potential cross-border utility takeover, with Energia, Ireland's biggest independent power company, in its sights.
City analysts say the Scottish utility is a front-runner for a £2 billion bidding auction, which is expected to be started this week when Dresdner Kleinwort posts an information memorandum to prospective bidders.
As well as SSE, led by chief executive Ian Marchant, this is expected to include other major UK and European electricity groups as well as financial buyers. The potential swoop comes as the latest Global 500 rankings of the world's largest corporations, published annually by Fortune magazine, show SSE surging 61 places to stand at 253.
That puts the Perth-based utility ahead of blue-chip giants such as Coca-Cola, 3M and Apple.
Commenting on the auction of Energia, one analyst said yesterday: "Normally you would think trade buyers would have an advantage over private equity in this sort of bid battle because of the duplication synergies they can get that are not available to financial buyers.
"However, it is not so simple with Energia, because there would be fairly limited cost-saving synergies with a UK or European utility taking it over. It should make the bidding interesting."
Arcapita, the Bahrain investment group that owns Viridian, Energia's parent company, decided to put the business up for sale after a strategic review by Dresdner. Indicative offers for the business are expected to be lodged by the middle of August.
SSE declined to comment yesterday, while Arcapita was unavailable for comment.
Analysts say other potential bidders for Energia, which has 35,000 customers, include Endesa of Spain and Eon, the German energy giant.
Marchant has made expanding into Ireland a priority and SSE, which boasts some 8.5 million customers, is understood to be in the frame to buy power plants being auctioned by the Electricity Supply Board, Ireland's state-owned power group.
Arcapita paid £1.62bn for Viridian less than two years ago. Once the sale is complete, Viridian would be left with assets including Northern Ireland Electricity, the transmission and distribution grid.
One analyst said: "Utilities are strong defensive assets in these difficult economic times. There should be no shortage of interest."
A deal is likely to be completed by the end of 2008, the City believes.
This story was featured on The Scotsman website.
Permanent link for this article
