SSE to sell 50 per cent stake in its telecoms arm for £380m in bid to cut debt
Scottish and Southern Energy (SSE) is set to sell a 50 per cent stake in its telecoms business to Infracapital for a fee of around £380m.
The company announced the planned sale to the infrastructure equity investment arm of M&G Prudential on Friday as it tries to reduce its debt.
It comes as part of a wider restructuring in which SSE plans to focus on its core businesses of regulated networks, renewables, flexible thermal generation and business energy sales.
SSE Enterprise Managing Director, Neil Kirkby, said: "Infracapital has a proven record of actively supporting the companies they work with; this partnership heralds an exciting era of growth for our dynamic telecoms business.
"We both see huge opportunities for organisations capable of providing infrastructure that help give businesses reliable high-speed connectivity."
The energy provider confirmed earlier this week it had scrapped plans to merge its British energy retail operations with a unit of Innogy SE.
SSE had agreed to merge its struggling energy supply business with rival Npower, but that was abandoned following the introduction of a price cap from the start of 2019.
Both companies reevaluated the proposed deal and due to a change in retail business performances, as well as a price cap that was tougher than SSE expected, they decided not to go ahead with the merger.
The loss of returns from SSE's energy supply business was a key reason for its 41 per cent slump in half-year adjusted pre-tax profit.
Last month the firm also unveiled a plan to create a new company for its renewable energy assets to help improve transparency and boost its ability to raise investment.