SSE, Innogy to create UK retail power firm with 11b pound sales

Frankfurt, Nov 9 (Reuters): SSE aims to turn up the heat on top-ranked British Gas with a merger of its UK power and gas retail operations with those of npower, owned by Germany's Innogy.

The deal will bolster second-ranked SSE, creating a supply group with 11 billion pounds in combined sales that could kick off a consolidation in the British energy market where established firms are battling smaller, nimble rivals.

The roughly 11.5 million customer accounts of the new firm would move SSE closer to Centrica's British Gas, which has more than 14 million.

The company, in which SSE would have a stake of about two thirds, and British Gas would together control more than 50 per cent of the market, but Innogy Chief Executive Peter Terium said he was confident British regulators would approve the deal.