SSE mulls sale of stake in gas firm SGN as part of £2bn disposals plan
Energy giant SSE today said that it was mulling the sale of all or part of its stake in gas firm SGN as part of its £2bn disposals programme.
SGN – formerly Scotia Gas Networks – owns and manages gas distribution to 5.9m households in Scotland and the south of England.
SSE hold a 33 per cent stake in the business, alongside partners such as the Abu Dhabi Investment Authority.
It said that it would make a decision on whether to proceed with a sale by the end of the financial year.
In recent years the FTSE 100 firm has pivoted away from providing power to homes to focus on renewable energy generation instead.
It has so far completed £1.5bn in disposals to this end, including the sale of its gas exploration and production assets in December.
In this morning’s trading update, SSE maintained its guidance for the year, with adjusted earnings per share expected in the 85 pence to 90 pence range.
The company said that it was on track to take a hit of between £150m to £250m due to the pandemic.
Donald Brown, senior investment manager at Brewin Dolphin, said: “SSE continues to make progress in re-shaping its business, with a greater focus on renewables and the disposal of non-core assets.
“The ‘green recovery’ from Covid-19 prioritised by governments should play to SSE’s strengths and shareholders will be pleased to see continued commitment to RPI-linked dividend increases over the next couple of years – particularly with income remaining precarious elsewhere.
“The company’s shares are basically unchanged over the year, which is a decent barometer of its success in managing the many challenges of 2020 and compares favourably to the FTSE 100, which is down 11% since January 2020.”