Perth energy giant SSE plays down talk of imminent break-up

SSE, the Perth-headquartered energy giant, stressed it had taken "no decision" to break up the company following weekend reports suggesting that a split was on the cards.

In a stock market announcement, the group said it would update shareholders on its future plans in November, but stopped short of denying that a split was potentially on the cards.

"There has been no decision to break up the SSE Group," the firm said in its statement.

It added: "Following recent reshaping of the group, SSE's clear strategic focus is on renewables and regulated electricity networks, supported by carefully chosen businesses."

Perth-headquartered SSE is one of the biggest players in the UK's renewables energy sector. Picture: Stuart Hatch

SSE sold its energy supply arm to Ovo Energy in 2020, jettisoning its consumer-facing business which had been one of the Big Six energy suppliers.

The potential split has reportedly been championed by Elliott Management, one of the world's most influential activist investors.

According to reports, Elliott has convinced the board of SSE that it makes sense to split its wholesale energy business from the part that builds new wind turbines and other renewables.

However, like SSE's statement, the report said that no final decision had been taken.

Listing the renewables business on a stock exchange separately would allow it to raise money from investors to put into developments. It would help SSE reach its goal to triple renewable output by 2030.

The group said its November update will let shareholders know how it plans to further accelerate growth. This will include how to boost the amount it invests and how it will fund these investments.

Chief executive Alistair Phillips-Davies said: "We have been making excellent progress with our clear net zero-aligned strategy, centred on electricity networks, renewables and other carefully chosen businesses that help provide the low-carbon electricity infrastructure that Government and wider society requires.

"SSE is the UK's national low-carbon energy champion, delivering for both our shareholders and society, and we look forward to updating investors on our plans to accelerate growth and create value in due course."

In July, the group said it was looking to add to its “enviable” offshore wind pipeline as it committed to a greener future.

The group, which is a widely held stock among private investors, also reiterated its commitment to a five-year dividend plan to March 2023.

In a trading update to coincide with its annual shareholder meeting in July, the firm flagged good progress on its disposals programme which is on course to realise more than £2 billion from the sale of non-core assets and businesses that are “not a good fit with SSE’s net zero strategy”.

The sale of the firm’s contracting business to Aurelius, first announced at the start of April, was successfully completed on June 30.

Gregor Alexander, SSE’s finance director, told investors: “We have delivered on our purpose through the coronavirus pandemic and are continuing to progress growth opportunities and options arising from our net zero strategy.

“We have an enviable offshore wind pipeline which we are seeking to expand and diversify. This represents an exciting future for SSE,” he added.

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