Perth-based energy giant SSE said on Monday the proposed merger of its household energy and services business in Great Britain with Innogy subsidiary Npower Group plc should not be affected by the proposed carve up of Innogy by its parent RWE and E.ON.
Nonetheless, SSE shares fell about 2%.
Under Sunday’s surprise, proposed break-up of Germany’s Innogy, its assets would be divided between parent RWE and E.ON, which would take over Npower, potentially raising regulatory concerns, some analysts said on Monday.
In a statement, SSE said: “SSE has noted the announcement of an ‘agreement in principle’ between EON SE and RWE AG relating to RWE’s stake in innogy SE.
“SSE and innogy SE entered into a legally-binding agreement in November 2017 to create a new independent energy supply and services company in Great Britain, subject to the conditions set out in the companies’ announcements at that time.
“One of the conditions was innogy’s supervisory board approval which was obtained in December 2017 and the agreement does not include provision relating to change of control.
“SSE therefore does not believe that its agreement with Innogy should be affected by the EON/RWE agreement.
“The transaction agreed by SSE and Innogy SE has so far proceeded in line with their agreement and announcements and is now subject of the CMA process that started in February.”
SSE said in November it agreed to demerge its household energy and services business in Great Britain with Innogy subsidiary Npower to form a new listed UK company.
The combination, if allowed, would create the UK’s second largest energy supplier.
On February 28, the UK’s Competition and Markets Authority (CMA) said it opened an investigation into whether the proposed merger of SSE Retail and Npower “could significantly reduce competition in the supply of energy to domestic customers in the UK.”