United Utilities shares were up 1.2% to 1,046.5p in late morning trading on Tuesday following the group’s reported agreement to sell its non-appointed United Utilities Renewable Energy Limited business.
The business will be sold to SDCL Energy Efficient Income Trust for approximately £100 million at enterprise value.
United Utilities confirmed its portfolio consisted of solar, wind and hydro renewable assets, which have been developed since 2014 and comprises 69 MW of renewable green energy generation across 70 sites.
The energy company mentioned the assets would continue to provide long-term green energy to its regulated United Utilities Water and Wastewater business following its portfolio divestment.
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United Utilities commented the sale would allow it to recycle its capital employed in the green energy portfolio into the next phase of its net zero progression while continuing to source green energy from its collection of assets.
The transaction is scheduled to close in the coming months, with the Royal Bank of Canada Capital Markets acting as financial advisor to United Utilities and Norton Rose Fulbright acting as legal advisor.
“We are committed to our ambitious carbon pledges and target of achieving net zero carbon emissions by 2030,” said United Utilities CEO Steve Mogford.
“A key part of setting the foundations for that goal has been our renewable energy portfolio that, in recent years, we have built across our UU sites. With the portfolio now fully built-out and operating well, we are excited about the opportunity to recycle our investment in these assets to support the next steps in our plans to achieve net zero.”
“We are confident that SEEIT will be an excellent long-term partner for the UU group, as the UURE asset portfolio moves into the next phase of its life cycle.”