Shell to buy British retail energy supplier First Utility
Royal Dutch Shell will buy British household energy and broadband provider First Utility, expanding its supply business into a new part of the UK retail market, the Anglo-Dutch company said on Thursday.
The retail energy market in Britain is still dominated by the "Big Six" suppliers - Centrica`s British Gas, Iberdrola`s Scottish Power, E.ON, EDF Energy, SSE and Innogy`s npower.
They have been losing market share to smaller suppliers, including First Utility, and the increased presence of Shell is likely to increase the pressure on them.
Shell did not disclose any financial details of the deal, which it expects to complete early next year, subject to regulatory and other approvals. First Utility and Shell`s joint German subsidiary is also included in the deal.
"The supply and demand of residential energy is rapidly changing, driven by new technologies that enable householders to better manage their energy use, and the need for a low-carbon energy system," Mark Gainsborough, Shell`s Executive Vice President of New Energies, said in a statement.
"This combination will enable Shell to enter a new part of the energy market in the UK and to improve choice for customers by delivering innovative services at competitive prices."
Shell Energy Europe Limited, Shell European gas and power marketing and trading business, will continue to supply wholesale gas and electricity to energy retailers in the UK and Europe, including First Utility, the firm said.
In 2015, Shell Energy Europe and First Utility partnered to launch a new household energy supplier in Germany.
The smaller rivals to the "Big Six" now control 20 percent of the UK market compared to less than 1 percent a decade ago.
First Utility has a 3 percent share of that market.
Last month, Innogy and SSE agreed to merge their retail power businesses, paving the way for more industry consolidation as pressures mount on the big suppliers in an increasingly crowded market.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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