Third phase of multi-million asset sell off completed at utilities group

Listed utilities service company Fulcrum has issued an update on the sale of its domestic customer gas connection assets and associated meters to ES Pipelines Limited (ESP).

Sheffield-headquartered Fulcrum says it has today completed its transfer of the third tranche of its domestic customer gas connection assets to ESP for a total of £3.8m.

Cash of £3.7m will be received on 1 June 2021, with the retention balance of £0.1m expected to be received on 31 May 2022.

Fulcrum says the cash has strengthened its balance sheet and supports its strategy and growth ambitions.

In addition, it has received a further £0.1m in cash in respect of the first and second tranche of assets transferred under the ESP asset sale.

This additional payment is a result of the Group achieving the first enhanced payment milestone under the asset sale agreement.

The total gross consideration receivable by Fulcrum is expected to be c.£49m.

£25.8m has been received to-date, leaving approximately £23.2m to be received, with the majority expected to be collected over the next two to three years.

The arrangement with ESP also includes further milestone targets which, if achieved, would trigger additional enhanced payments of up to £3.9m over the remaining term of the contract.

Terry Dugdale, Fulcrum CEO, said: “We are pleased to report another successfully completed tranche in the asset sale to ESP.

“The proceeds from this third tranche, and the future proceeds from the sale, provide the Group with additional financial strength that supports the continued strengthening of the business and the execution of our strategy and growth plans.”

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