British utility Centrica is snapping up a US gas supplier for nearly half a billion pounds as it looks to expand its presence in North America.
Britain's biggest energy provider said in a statement that it will buy the New Jersey-based Energy Marketing business of Hess Corporation for £476m (€550m, $731m) in cash plus net working capital of around £196m.
Centrica's North American subsidiary Direct Energy Business will be the direct buyer.
"This transaction will transform our business-to-business operations in North America, giving us leading positions in business gas and power supply and creating a unique dual fuel business in the US," said Centrica's chief executive Sam Laidlaw.
The deal follows a long line of acquisitions that Centrica has made in North America in order to bolster its presence and tap further into the world's largest economy.
In mid-July, Centrica revealed that it was buying Texas-based electricity retailer Bounce Energy for £30.3m, in order to give it a new online platform to help grow its North American customer base.
Bounce is a privately held company but it has more than 80,000 residential customers. Over the years, it has developed an internet-based platform for marketing products and servicing customer accounts.
"(This) will provide our customers with more innovative and efficient energy options and also gives Direct Energy a leading online platform as we look to grow our North American customer base," said Badar Khan, President and CEO of Centrica's US subsidiary Direct Energy, at the time.
Pressure in the UK
In Britain, the government is putting pressure on energy companies to offer customers their lowest tariffs up-front.
In June, UK energy regulator Ofgem proposed new rules what would force energy companies to offer only four tariff options each for electricity and for gas and help customers find the cheapest offer available.
British Gas, owned by Centrica, said in a statement that "following a review, British Gas will move to offering customers a single standing charge per fuel. This will apply to all new products launched from today."
Meanwhile, Centrica is looking to tap into other growth opportunities.
In June, the group revealed it has paid £40m for a 25% stake in in a major gas-bearing formation in northern England, ahead of expanded drilling next year- the Bowland Shale in Lancashire, owned by license operator Cuadrilla Resources and its Australian private-equity backer AJ Lucas.
It will also invest £60m in developing Cuadrilla's Bowland licenses and a further £60m depending on production and exploration tests.