Sheffield-based Fulcrum's gas connection sale gets green light

Fulcrum Utility Services said key conditions in relation to the sale of its domestic customer gas connection assets, order book and associated meters to E.S. Pipelines (ESP), particular those relating to Ofgem and the Competition and Markets Authority (CMA), have been satisfied.
Daren Harris, Fulcrum's CEO.Daren Harris, Fulcrum's CEO.
Daren Harris, Fulcrum's CEO.

The Sheffield-based multi-utility infrastructure and services provider announced the deal on December 23, 2019.

Meeting of key conditions means that the sale will complete by the end of March 2020.

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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.

Fulcrum said the 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 that there will be at least one further transfer in 2020 with a minimum consideration of £6.5m.

The group also announced several recent utility contract wins by Dunamis, its electrical design and build business.

Daren Harris, CEO of Fulcrum, said: "I am pleased to announce that the key conditions in relation to the sale of our domestic gas assets to ESP have now been satisfied.

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"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

"The electrical capabilities of Dunamis has enabled the Group to tender on and contract win opportunities previously unachievable to the business, and we are delighted to announce that we have secured these large and significant electrical and dual fuel contracts.

"This strong succession of significant orders highlights immediate potential in the electrical market following a period of political and economic uncertainty.

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"The board is confident that 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."

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