The Shell Petroleum Company Limited (Shell) has signed an agreement to buy 100% of First Utility, an independent UK household energy and broadband provider.

"The Shell group’s energy supply, trading and marketing expertise, combined with First Utility’s experience in serving around 825,000 homes in the UK, will enable First Utility to grow and develop more innovative services for customers. Expanding our energy supply business from commercial and industrial customers into the residential sector through First Utility allows us to bring our products and services to more customers every day," Shell said

"Shell sees a new electricity value chain emerging in the UK, in which customers play an increasingly important role -- managing their use and selling some power back to the grid," Shell said

"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. "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 (SEEL), the Shell group’s 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. In 2015, a licensing agreement between Shell Brands International and First Utility enabled them to operate in the German household energy sector under the Shell brand.

First Utility is one of the largest independent UK household energy and broadband suppliers, with a 3% share of the UK residential energy market. First Utility’s 100%-owned subsidiary in Germany, First Utility GmbH, is also included in the deal.

The deal is subject to regulatory and other approvals and is expected to be completed in early 2018.

"This agreement complements the Shell group’s growing network of forecourt charging points and our recent acquisition of NewMotion, one of Europe’s largest vehicle charging providers, which gives customers the flexibility to charge their electric vehicles at home, work and on the go," Shell said

Tags:
M&A   Shell   Innovation   U.K.  

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