2nd Apr 2008 07:00
Centrica enters into agreement to acquire North American C&I business Centrica plc today announced that its North American subsidiary, Direct Energy,has entered into an agreement to acquire Strategic Energy LLC, a subsidiary ofGreat Plains Energy Inc. (NYSE: GXP), for a total cash consideration of US$300million (£151 million). The transaction is debt free and includes a significantamount of working capital which will be subject to a subsequent true-up. Strategic Energy is one of the United States' largest competitive electricitysuppliers to the commercial and industrial (C&I) market with over 26,000customers across 11 states with revenues of some $2 billion and sales of 21TWh.During the year ending 31 December 2007 it delivered an EBITDA of just overUS$23 million. The merger of Strategic Energy with Direct Energy's existing C&Ibusiness will create a business supplying almost 55TWh of electricity and gas tocustomers which will make it a top three supplier of energy to the C&I market inNorth America and enable the achievement of material synergies. This acquisition is an excellent fit with Direct Energy's current business bothgeographically and strategically and enables it to accelerate its growth plansthrough immediate scale benefits in excess of US$15m per annum, followinginitial one-off integration costs, and further cross-selling opportunities in acompetitive C&I market. Sam Laidlaw, Chief Executive of Centrica, said: "Acquiring Strategic Energy isin line with our strategy of building on our growth platforms. It immediatelystrengthens our position in the important North American commercial andindustrial market and, together with our recent acquisition of Rockyview Energy,it maintains Centrica's ongoing commitment to growing this important part of ourbusiness." The transaction is subject to regulatory approval and is expected to close inJune 2008. \* TEnquiries:Centrica Investor Relations: 01753 494900Centrica Media Relations: 0845 072 8001\* T Notes: 1/ The acquisition will be made through Centrica plc's wholly owned subsidiaryDirect Energy Services LLC. Copyright Business Wire 2008Related Shares:
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