Centrica to sell Direct Energy for $3.63bn

By Jonathan Campion
Centrica Plc, the multinational energy and services company, has announced the sale of its North American business...

Direct Energy has been bought by the American power firm NRG Energy. Centrica took the decision to sell Direct Energy in light of a difficult financial prognosis due to the impact of the Covid-19 pandemic and low commodity prices.

The money raised from the deal will be used to reduce the British company’s net debt.

The Chief Executive of Centrica Group, Chris O’Shea, said that the deal was a good one for all parties: “We had a number of expressions of interest in Direct Energy but it came down to the right price and the right buyer”.

NRG will now serve six million retail customers in North America, three million more than before the purchase of Direct Energy. Having previously operated mainly in Texas, it makes the company a more prominent player in the eastern United States in particular.

Centrica now faces an uncertain future. The group has suffered a 14% drop in operating profit to £343mn ($436.3mn), largely due to the Covid-19 pandemic that has hit commodity prices and lowered energy usage. Last month it announced plans to cut 5,000 jobs, or one-fifth of its global workforc

Share

Featured Articles

UK and US announce energy partnership

The agreement will work towards reducing global dependency on Russian energy exports, stabilising energy markets, and stepping up collaboration

Alfa Laval to supply world’s largest green hydrogen plant

The facility is being built in NEOM, the US$500bn futuristic city being developed in Saudi Arabia

COP27 agrees to climate compensation fund

The deal is said to be a historic first in acknowledging the vast inequities of the climate crisis

North America's natural gas can help mitigate energy crisis

Oil & Gas

COP27: Egypt and Norway to build 100MW green hydrogen plant

Renewable Energy

Renewable energy company Masdar opens office in Saudi Arabia

Renewable Energy