SSE PLC said Jan. 15 that it is completing the sale of its U.K. retail energy business, SSE Energy Services Group Ltd., to Ovo Group Ltd. subsidiary Ovo Energy Ltd., around a month after the U.K. Competition and Markets Authority cleared the proposed deal.
The proceeds from the sale, amounting to £500 million — £400 million in cash and £100 million in loan notes — will be used to reduce SSE's net debt.
The transaction is further expected to help the utility focus on delivering low-carbon infrastructure needed to help the U.K. reach net zero emissions.
"The sale is in line with our clear strategy, centered on developing, operating and owning renewable energy and electricity network assets, along with growing businesses complementary to this core," SSE CEO Alistair Phillips-Davies said in a news release.
In order to ensure a smooth transition, SSE will continue to provide services to Ovo for a certain period post completion, under a transitional services agreement.
Meanwhile, the transaction was agreed on a "locked box" basis, which set the date for transfer of economic interest in SSE Energy Services at June 30, 2019.