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Summary
- UK utilities giant National Grid announced its plans to acquire energy company PPL Corp’s UK electric distribution arm Western Power Distribution for £7.8 billion.
- The National Grid also plans to sell-off its US-based subsidiary Narragansett Electric Company to PPL Corp for up to US $3.8 billion.
UK-based multinational electricity and gas utilities company National Grid Plc (LON:NG) announced on 18 March that it would acquire energy company PPL Corp’s (NYSE:PPL) UK electric distribution arm Western Power Distribution in a deal worth up to £7.8 billion, making it the biggest deal in ten years. The move is part of National Grid’s green transition strategy.
Separately, the National Grid plans to sell its US-based subsidiary company Narragansett Electric Company to PPL Corp valued at US $3.8 billion. Moreover, the UK utilities giant also plans to offload its majority stake in its gas business National Grid Gas later this year. The selloff comes amid investors and other stakeholders’ increasing pressure to divest from fossil fuels.
National Grid Plc’s (LON: NG.) stock prices closed at GBX 829.00, down by 0.29 per cent as of 18 March following the news, while the FTSE 100 index, which it is a part of, closed at 6,779.68, up by 0.25 per cent. National Grid’s market cap stood at £29.507 billion.
Also Read: National Grid Plc (LON: NG.) gets FCA approval of final terms for issue of EUR 500,000,000
Here we take a look at 3 other FTSE utility stocks with a green focus and a one-year return of over 19 per cent:
- SSE PLC (LON:SSE)
The FTSE 100-listed multinational utilities giant SSE PLC (LON:SSE) issued a 7-year green bond worth £ 250 million with a coupon rate of 1,500 per cent and a 15-year green bond of £250 million with a coupon of 2,125 per cent through its subsidiary Scottish Hydro Electric Transmission plc (SHET) on 18 March.
This is its fourth green bond issuance and is part of its net zero emissions strategy. BBVA was the bookrunner and structurer of the dual tranche transactions.
SSE PLC’s (LON:SSE) stock prices closed at GBX 1,405.50, up by 1.41 per cent as of 18 March following the news, while the electricity generation and distribution sector index closed at 8,429.33, up by 1.22 per cent. The company’s market cap stood at £14.46 billion.
Also Read: SSE Plc to triple its renewable energy generation by 2030
- Centrica PLC (LON:CNA)
FTSE 250-listed energy and services company Centrica PLC (LON:CNA) announced a 10-year solar power purchase agreement (PPA) with a renewable energy company Better Energy for up to 112GWh per year on 17 March.
According to the deal, Centrica will handle and trade the electricity produced by Better Energy’s two new solar parks and add it into the EU’s power grid.
Centrica PLC’s (LON:CAN) stock prices closed at GBX 53.84 , down by 2.92 per cent as of 18 March, while the FTSE 250 index closed at 21,568.56, up by 0.046 per cent. The company’s market cap stood at £3.25 billion.
- Drax Group PLC (LON:DRX)
FTSE 250-listed electricity generation company Drax Group PLC (LON:DRX) recently scrapped plans to build a gas-fired power plant in North Yorkshire after facing strong pressure from environmental groups.
The gas plant would have emitted up to 400 per cent more greenhouse gases if developed, according to climate group ClientEarth.
Drax Group’s (LON:DRX) stock prices closed at GBX 414.00, down by 0.19 per cent as of 18 March. The company’s market cap stood at £1.644 billion.
