Utility company SSE plc (LON:SSE) has confirmed it is to sell a chunk of its holding in Scotia Gas Networks (SGN).
The company had held a 50% stake in SGN, but this will reduced to 33.3% after it offloaded a 16.7% stake to the Abu Dhabi Investment Authority for £621mln. SSE’s 50% stake in gas distribution business SGN cost it £505mln back in 2005.
The move was not unexpected, as the group had indicated at the time of its full-year results publication, back in May, that it was considering selling up to a third of its holding, and the market was mainly concerned with the company’s plans for the money; for those plans to be revealed, we will have to wait until SSE’s interim results on 9 November.
"Over the last decade, SGN has become a leading gas distribution business for the benefit of customers and investors alike. The sale of a 16.7% stake confirms SSE's ability to deliver value for shareholders through focused, timely disposals while at the same time retaining a diverse range of regulated and unregulated businesses in order to support long term dividend growth,” claimed Alistair Phillips-Davis, chief executive officer of SSE.
Shares in SSE were down 7p, roughly in line with the market, at 1,541p in mid-morning trading.