TIDMSSE
RNS Number : 7850N
SSE PLC
31 July 2014
SSE plc
ACQUISITION OF THE ENERGY SOLUTIONS GROUP
SSE plc has completed the acquisition of The Energy Solutions
Group Topco Limited (ESG), a Manchester-based designer and provider
of energy management solutions, from Bridgepoint Development
Capital, for an enterprise value and total cash consideration of
GBP66m with the potential for a further GBP6m if agreed targets are
achieved.
ESG has traded for almost 20 years and employs around 340
people. It works with private and public sector customers to
identify improvements in their management of energy consumption;
and to install, maintain and support building management systems
and solutions that support this. ESG can typically save its
customers around 20% to 30% of their energy consumption.
The acquisition of ESG complements and enhances SSE's services
in competitive markets for industrial and commercial customers. As
stated in SSE's financial results statement in May, these services
- including electrical and mechanical contracting, lighting
services, private energy networks and telecoms - are being brought
together in an 'Enterprise' division to meet the energy and related
needs of such customers in an enhanced and co-ordinated way.
The existing management team at ESG will lead this business,
which will continue to trade as The Energy Solutions Group. SSE
believes that it will benefit from the commitment of the ESG
management team and other employees to delivering effective energy
management solutions for the benefit of customers and the
environment. It is expected to earn annual operating profit of over
GBP10m within five years, in addition to the commercial synergies
that it will bring to SSE's Enterprise division.
Jim McPhillimy, SSE's Managing Director, Enterprise, said:
"Managing energy costs and environmental impact are big
priorities for businesses and other organisations. As a responsible
company focused on the long term, we believe it is in SSE's
interests to make the consumption of energy more sustainable. ESG
is a leading provider of energy management solutions and these will
be offered to SSE's existing and potential new customers as part of
a significantly increased presence in the growing
business-to-business market for energy services.
"This market will be increasingly important in the next few
years, and SSE's programme to dispose of assets and businesses that
are not core to its future plans is designed to enable the company
to make a success of those opportunities which are, such as energy
services. The disposal programme is well under way and we expect to
report substantive progress in the autumn."
ENDS
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