Scotland-based energy company SSE Plc (OTC:SSEZY) will sell its 50% stakes in two energy-from-waste joint ventures Multifuel Energy Ltd and Multifuel Energy 2 Ltd for approximately $1.3 billion (995 million pounds), reports Bloomberg.
Australian asset management company First Sentier Investors' European Diversified Infrastructure Fund III will buy the stakes in an all-cash deal.
What Happened: SSE’s sale agreement is an attempt to shift its attention towards renewable energy, as per Bloomberg.
SSE had flagged both the Multi Energy units for disposal in June as a part of its strategy to generate approximately 2 billion pounds by selling some of its assets by fourth quarter of 2021.
The deal is expected to close by the end of 2020 after approval by the European Commission.
"While these multifuel assets have been successful ventures for SSE, they are non-core investments and we are pleased to have agreed a sale that delivers significant value," said SSE's finance director Gregor Alexander.
Earlier this year, SSE offloaded its retail energy business — SSE Energy Services, for 500 million pounds.
Why Does It Matter: Multifuel Energy and Multifuel Energy 2 produce low carbon electricity from waste-derived fuel. It is a 50-50 joint venture between SSE and Wheelabrator Technologies Inc.
Both plants generate a net 72 megawatt electricity per year by processing over 675,000 tons of waste, according to a Renewable Energy World publication.
Price Action: SSE's ADR closed 2.91% higher to $17.34 Monday.