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SSE, the FTSE 100 vitality firm, has bought a 25 per cent stake in its electrical energy transmission community in Scotland to Ontario Lecturers’ Pension Plan Board for £1.5bn, because it seeks to boost money to put money into renewable vitality.
SSE put the enterprise up on the market final November however the course of has taken greater than a yr. The proceeds will probably be used to pay for the transition to renewables similar to funding in wind farms.
London-listed SSE operates gas-fired and hydroelectric energy crops and wind farms together with an electrical energy transmission division. That enterprise is one in every of three regional infrastructure monopolies within the UK whose pylons and cables carry electrical energy from energy turbines to houses and companies.
Because the networks are regional monopolies with no competitors, their revenues are set by the regulator Ofgem and funded by levies on shopper vitality payments.
Rob McDonald, managing director of SSEN Transmission, stated: “With the north of Scotland residence to the UK’s best assets of renewable electrical energy now we have a important function to play in serving to ship the UK and Scottish governments’ web zero commitments.
“Our investments may even be key to securing the UK’s future vitality independence by way of enabling the deployment of homegrown, reasonably priced, low-carbon energy.”
The enterprise will probably be chaired by SSE’s finance director, Gregor Alexander, and Ontario Lecturers’ Pension Plan Board will get seats on the board.
Investor urge for food for infrastructure belongings has held robust for the reason that pandemic began, when different industries similar to retail had been badly affected. Nevertheless, rising financing prices had made it tougher to shut offers, individuals near the negotiations stated.
Final yr a consortium backed by Ontario Lecturers and Brookfield Tremendous-Core Infrastructure Companions agreed to purchase SSE’s remaining stake in a Scottish pure gasoline community for £1.2bn.
A consortium led by Macquarie additionally purchased a 60 per cent stake in Nationwide Grid’s UK gasoline transmission enterprise this yr.
Nevertheless, in June a £15bn takeover of Britain’s largest electrical energy distributor to a Macquarie-led consortium collapsed after the seller, Li Ka-shing’s CK Infrastructure Holdings, elevated the value two days earlier than the settlement was attributable to be signed.
Ontario Lecturers is one in every of Canada’s largest pension funds. It not too long ago misplaced $95mn on an funding within the collapsed cryptocurrency change FTX, however stated it might have solely “restricted influence”.
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