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Bids close in potential £1bn sale of top NI power firm

By Margaret Canning

Published 16/01/2016

First-round bids for the owner of Northern Ireland's largest electricity supplier closed last night
First-round bids for the owner of Northern Ireland's largest electricity supplier closed last night

First-round bids for the owner of Northern Ireland's largest electricity supplier closed last night.

Centrica, the UK's biggest energy supplier and the owner of British Gas, is among the firms anticipated to make an offer for Power NI parent company Viridian.

Power NI yesterday refused to comment on its potential sale, while Centrica also did not wish to comment.

With around 600,000 customers, Power NI is the biggest supplier of electricity to homes here, followed by SSE Airtricity and Budget Energy in second and third place respectively.

News agency Bloomberg this week claimed Centrica was eyeing up Viridian, which is currently owned by private equity firm Arcapita. Australian financial services firm AMP Ltd is also believed to be interested. It was reported in September that Arcapita wished to sell Viridian for around £1bn.

Aodhan O'Donnell, the owner of energy price comparison website Powertoswitch.co.uk, said: "The Viridian sale, which could exceed £1bn, is far removed from the lives of consumers trying to pay their bill this month or find the money to top up their meter.

"And although it is unlikely we will see any immediate changes, an increase in competition and further pressure on prices would be welcome."

Economist John Simpson said that as an energy company, Centrica could be a more "competitive" operator of Power NI than Arcapita, a private equity firm.

It was also likely to bring more technical expertise to the operation.

Viridian's shareholders had not been taking any dividend from the company in recent years but would get a major return in the event of a sale, he said.

He added: "It has been a profitable business recently because Power NI has not been passing down savings to customers in line with the fall in the wholesale price of oil."

Oil prices have fallen from around $115 per barrel around 18 months ago to around $30.

In the Republic, Viridian owns Energia, which supplies electricity to the domestic and commercial markets and also owns and operates the Huntstown Power Station in Dublin. Energia also supplies some business customers in Northern Ireland.

Northern Ireland's electricity supply market has seen a flood of new entrants in recent months. Electric Ireland, Click Energy and Open Electric all joined last year.

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