PPL Corp. plans to sell its United Kingdom utility business, Western Power Distribution, to focus on the U.S. market.
The Allentown-based company said in a statement that selling the U.K. business it will make the company a “purely U.S.-focused utility holding company and create additional shareowner value.”
PPL president and CEO Vincent Sorgi said the move comes after the board of directors assessed a comprehensive strategic review of the company’s business mix and future growth opportunities.
“WPD is a very strong business that continues to perform exceptionally well as the premier distribution network operator group in the U.K., but we believe it continues to be undervalued by the market as part of PPL,” he said. “We believe that greater value can be achieved for PPL shareowners through a sale of the U.K. business and use of proceeds that would be focused on strengthening PPL’s balance sheet and enhancing the company’s long-term earnings growth, which could include supporting strategic growth opportunities in the U.S. and returning capital to shareowners.”
WPD, which serves about 8 million customers in central and southwest England and south Wales, is expected to play a critical role in supporting the U.K.’s transition to net-zero carbon emissions by 2050, he noted.
PPL engaged JP Morgan Securities LLC to act as its financial adviser on the sale process. PPL hopes to complete the sale in the first half of 2021.
PPL said it expects to evaluate a variety of offers for the purchase of WPD, including all cash or a combination of cash and U.S. utility assets.