Shell moves into household supply with First Utility acquisition
Oil and gas giant Royal Dutch Shell inked an agreement on Thursday that would see it acquire 100% of British household energy and broadband provider First Utility in the New Year.
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Shell said its energy supply, trading and marketing expertise, when combined with First Utility's UK retail experience, would enable the latter to "grow and develop more innovative services" for its customers, and that the expansion of its own energy supply business into the residential sector would allow it to bring further diversified products to customers.
Mark Gainsborough, Shell's executive vice president of New Energies, said, "The supply and demand of residential energy is rapidly changing, driven by new technologies that enable householders to better manage their energy use, and the need for a low-carbon energy system."
"This combination will enable Shell to enter a new part of the energy market in the UK and to improve choice for customers by delivering innovative services at competitive prices," he added.
Shell Energy Europe, the group's European focussed gas and power marketing and trading business, would continue to supply wholesale gas and electricity to energy retailers in continental Europe, as well as in the UK.
"We believe that the time is right to build upon our strong relationship with First Utility by investing to grow its business," Gainsborough said.
As of 1600 GMT, shares had gained 1.87% to 2,455.50p.