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Direct Energy Agrees To Sale Of Its Ontario Home And Small Commercial Services Business To EnerCare

Stocks in this article: CNACPYYY

HOUSTON, July 24, 2014 /PRNewswire/ -- Direct Energy, one of North America's largest energy and energy-related services providers, today announced an agreement with EnerCare for the sale of the Direct Energy-branded home and small commercial services business in Ontario to EnerCare for $550 million (CAD). Direct Energy and EnerCare have jointly served more than one million home services and water heater rental customers in Ontario for more than 12 years. EnerCare owns the water heater assets, while Direct Energy provides services and manages the customer relationships.  This transaction will combine the two parts of the business into a single entity, wholly-owned and managed by EnerCare, enhancing the overall customer proposition.

Direct Energy Logo.

Badar Khan, President and CEO of Direct Energy, said: "This is an attractive opportunity to realize value from the Ontario home and small commercial services business. With our activities in Ontario no longer forming a material part of the business, we will focus our attention on opportunities in other parts of North America, through a range of innovative products, including combined energy and services offerings."

In addition to water heater rentals, the Ontario home and small commercial services business will continue to provide its nearly 1.9 million total customer contracts with plumbing, protection plans, HVAC installs and maintenance, duct cleaning, and other services. Customers can expect the same exceptional level of customer service that the company has consistently provided. Under a licensing agreement, EnerCare will continue to use the Direct Energy brand for a 12-month transitional period. The sale is expected to close in 2014.

"Direct Energy's Ontario home and small business services team has been a key part of our company dedicated to our customers for more than 12 years. They have our appreciation and gratitude, and we know they will be in good hands with EnerCare," Khan added.

Direct Energy Direct Energy is one of North America's largest energy and energy-related services providers with more than seven million residential and commercial customer relationships. Direct Energy provides customers with choice and support in managing their energy costs through a portfolio of innovative products and services. A subsidiary of Centrica plc (LSE: CNA), one of the world's leading integrated energy companies, Direct Energy operates in 46 U.S. states plus the District of Columbia and 10 provinces in Canada.

Note: Direct Energy was represented by Scotiabank and McCarthy Tetrault LLP.

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