Shares in energy provider SSE (SSE) were traded up 0.3% to £16.39 after the company said there had been no decision to break up the company, amid press reports that activist investor Elliot wants it to sell or separate its renewables business.

These machinations are taking place as the UK faces a potential energy crisis linked to surging gas prices.

SSE reiterated that it would provide an update on its growth strategy with its first-half results in November, including details of ‘significantly increased’ capital investment for the period to 2026.

The update, it added, would also cover sources of funding and SSE's vision for further growth into the 2030s.

INTERPRETING THE STATEMENT

SSE, which recently sold its electricity retail business to OVO, said it had adopted a 'clear strategic focus' on renewables and regulated electricity networks.

AJ Bell investment director Russ Mould said: ‘There are two ways to interpret this statement.

‘On one hand, the words “there is no decision” might imply that some consideration might still be given to a break-up – as in there is no decision yet.

‘On the other hand, the company says it already has a clear strategy and has promised to give all the details on spending and the how this might drive growth at the half year results in November. It doesn’t want an activist investor getting in its way before investors have had a chance to digest the plan for future value generation.

‘Activist investors are known for their persistence so one can be sure that Elliott won’t give up following the energy group’s latest statement.’

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Issue Date: 20 Sep 2021