SSE PLC (LSE:SSE) (LSE:SSE) is being considered as a potential takeover target after an activist investor was reported to have built a large stake in the FTSE 100 energy firm.
Elliott Management, an institution well-known for buying large holdings in corporations in order to force changes, has amassed a stake in SSE, according to City sources and is rumoured to be mulling a potential campaign for a shake-up at the group.
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The Mail on Sunday reported that Elliot’s move could mean a takeover bid of around £20bn could be on the cards for SSE, however, the activist’s previous strategies at other blue-chip UK firms could also raise speculation of a potential break-up of the firm’s businesses.
Elliott’s previous efforts in the London market included a campaign at pharma giant GlaxoSmithKline PLC (LSE:GSK) to appoint new directors and force a vote on whether chief executive Emma Walmsley should keep her job after the firm spins off its consumer division, effectively forcing her to reapply for the CEO role.
Elliott also pushed Premier Inn owner Whitbread PLC (LSE:WTB) to sell off its Costa Coffee business back in 2018, a strategy that was eventually executed with Coca-Cola Co buying the café chain for just under £4bn.
The Mail’s report also noted that sources in the City considered any corporate pressure on SSE could be of interest to one of Europe’s major power firms such as French group EDF or Spain’s Iberdrola, the latter of which bought Scottish Power in 2007 for £11.6bn.
Rumours of Elliott’s potential stake-building sent shares in SSE up 2.1% to 1,578p in early deals on Monday.