SSE and Innogy have terminated negotiations to combine the two companies’ retail businesses in the UK.
Innogy said that the reason for the decision was because they “could not agree on a joint solution for the necessary direct and indirect financial contributions”.
SSE said following discussions on potential changes to the commercial terms of the deal the company had decided that it is “not now in the best interests of customers, employees or shareholders to proceed with the transaction”.
It added: “The board has therefore decided that other options for SSE Energy Services should now be considered, including a standalone demerger and listing on either the premium or the standard listing segment of the official list, a sale or an alternative transaction.”
Innogy chief operating officer retail Martin Herrmann said: “Adverse developments in the UK retail market and regulatory interventions such as the price cap have had a significant impact on the outlook for the planned retail company.
“We negotiated intensively with SSE on adjustments to the transaction as announced in November 2017. Unfortunately, we could not reach an agreement that was acceptable for both sides. We are now assessing the different options for our British retail business.”
SSE chief executive Alistair Phillips-Davies said: “This was a complex transaction with many moving parts. We closely monitored the impact of all developments and continually reviewed whether this remained the right deal to do for our customers, our employees and our shareholders.
“Ultimately, we have now concluded that it is not. This was not an easy decision to make, but we believe it is the right one.
“We are now exploring all the available options with a view to delivering this future in the best possible way. In this, the interests of our customers, employees and shareholders remain paramount.”