Three of Britain's largest power providers have expressed interest in acquiring Shell's (SHEL.L) UK retail business which was put under review due to poor returns earlier this year, sources close to the process said.
Octopus Energy and Ovo have placed bids for Shell Energy and progressed into the second round of bidding, according to the three sources. British Gas, the retail arm of Centrica <CNA.L>, also bid but it was unclear if it had progressed to the second round.
Shell and Centrica declined to comment. Octopus Energy and Ovo did not respond to requests for comment.
Shell Energy, created with the acquisition of First Utility in 2019, has almost 1.5 million customers after it absorbed several failed rivals in recent years.
Putting a price on the business is tricky due to large uncertainty over future power prices following last year's price volatility in the wake of Russia's invasion of Ukraine and the value bidders assign to new customers, two sources said.
As a result, Shell Energy could be valued in a range $50 million to $100 million, according to the sources.
Shell Chief Executive Officer Wael Sawan put its British, German and Dutch energy retail businesses under review within weeks of taking office in January, citing "tough market conditions."
Shell said at the time it had launched a strategic review of the three businesses which is likely to take a few months, but that no decision had been taken yet on their future.
Octopus Energy last year acquired rival Bulb, which was one of the largest energy suppliers to collapse in 2021 due to soaring wholesale gas and electricity prices. Several rivals including British Gas have challenged the deal.
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