Shell has agreed to purchase First Utility in a move which will see the petrol giant enter the UK domestic supply market.
The company confirmed its acquisition today, stating that it had signed an agreement to buy 100% of First Utility, one of the major competitors to the UK’s Big Six utilities.
Shell said that its supply, trading and marketing expertise would enable First Utility to grow beyond its existing customer base of around 825,000 homes and develop “more innovative” services for its customers.
The move comes just four months after Shell confirmed its intent to capture the UK’s C&I power supply market having secured a licence from regulator Ofgem.
Mark Gainsborough, executive VP of new energies at Shell, said that the domestic market in the UK was “rapidly changing”, driven largely by new, low carbon technologies and the ability to better manage a household’s energy use.
“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.
“We believe that the time is right to build upon our strong relationship with First Utility by investing to grow its business,” he said.
Shell has been supplying First Utility with wholesale gas and electricity since 2015.
The deal is subject to regulatory and other approvals with Shell expecting it to complete early next year.