Green light for £33m sale of utility firm assets
Sheffield-based Fulcrum Utility Services has confirmed a £33m sale of its domestic customer gas connection assets and order book can now go ahead.
Key conditions in relation to the sale to ES Pipelines (ESP) – in particular those relating to Ofgem and the Competition and Markets Authority – have been satisfied, meaning the deal will occur by the end of this month.
The estimated net consideration of £33m will be received in tranches, with the initial tranche of approximately £17m received at completion and the balance to be received over the next four years.
Proceeds from the initial tranche will be used to repay in full existing borrowings at completion which are estimated to be £12m.
It is expected there will be at least one further transfer in 2020 with a minimum consideration of £6.5m.
Daren Harris, Fulcrum’s CEO, said: “The sale will significantly strengthen the Group’s balance sheet and it supports our future strategic growth ambitions.
“Our new relationship with ESP is also progressing well and is already helping to enhance the Group’s capabilities and service offering in our core design and build markets.”
Fulcrum has announced recent utility contract wins by Dunamis, the Group’s electrical design and build business. These include:
Two contracts won with a combined value of £3.2m, to install new high voltage electrical infrastructure for two 50MW gas peaking plants, connecting them to the 132kV network in North East England.
A £1.9m contract to design and build both the high voltage electrical infrastructure and gas infrastructure for an electrical generation site in the South East of England.
A £1.8m contract to install new electrical infrastructure to service more than 1,300 properties as part of a regeneration scheme in the South East for a major housing developer.
£1.7m, across two contracts, to design and build the high voltage electrical infrastructure for two solar farms in East Anglia.
Harris added: “The electrical capabilities of Dunamis has enabled the Group to tender on and contract win opportunities which were previously not achievable for the business.
“This strong succession of significant orders highlights immediate potential in the electrical market following a period of political and economic uncertainty.
“The Board is confident these wins, coupled with recent market developments such as the decarbonisation of energy, also demonstrate the significant, long-term level of opportunity available to us in the electrical infrastructure market.”
