Shell plans to sell its home energy business in Britain and Germany

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Shell said on Friday it will sell its domestic energy businesses in Britain and Germany to British energy giant Octopus Energy Group as part of a deal in which the two companies will explore partnerships in electric vehicle charging.

Revenues in Britain’s retail energy sector have been under pressure over the past few years, with companies struggling with total energy costs and caps on the prices they can charge customers imposed by sector regulator Ofgem.

Steve Hill, Shell’s executive vice president, said the company will focus on projects and countries where it believes it can create the most value.

Shell Energy Retail Limited in the UK and Shell Energy Retail GmbH in Germany provide gas, electricity and home broadband services to around two million customers operating under the Shell Energy brand.

Following the acquisition, Octopus is likely to become Britain’s second largest domestic energy supplier with around 6.5 million customers, behind Centrica’s British Gas with 7.5 million retail customers.

Last year, Octopus bought rival Bulb, one of the biggest energy suppliers to collapse in 2021, amid soaring wholesale gas and electricity prices.

“The transaction is expected to close in the fourth quarter of 2023, subject to regulatory approval,” the company said in a statement.

Financial details of the deal were not immediately disclosed, but estimates put the value between $50-100 million.

On the other hand, the two companies said they signed a memorandum of understanding to explore possible international partnerships in electric vehicle charging.