Utilities: Merger mania won't go away
The year ahead: What 1999 is going to mean for six crucial stock market sectors
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.AS BUSINESSES GO, the utilities may be as dull as ditchwater. But they have yet to lose their capacity to surprise and entertain the stock market and this year does not look like being any different.
Last year ended with a welter of transatlantic takeover deals in the electricity sector, with ScottishPower buying PacifiCorp and National Grid snapping up New England Electric System. More corporate activity is on the cards in the next 12 months. PowerGen has not given up on its ambition of merging with a US utility and the nuclear generator, British Energy, is on the prowl in the US.
Closer to home, expect to see a continuing exodus of American utilities from the UK electricity market. Two have already sold their regional electricity companies and others are likely to follow suit, or at least split the businesses in two, as the US owners of Midlands Electricity have done.
Consolidation looks like being the name of the game in the energy market, with several regional electricity companies likely to merge their supply businesses. But the water industry may also be poised for consolidation, with Thames Water leading the way. It argues that if the industry is to live with the 15-20 per cent price cut proposed by the industry regulator Ofwat, and still afford to invest an extra pounds 8.5bn in environmental programmes, then cost-saving mergers are essential.
Ian Byatt, the Ofwat director general, has blocked consolidating mergers once and he will take some persuading to change his views.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments