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Innogy to restructure npower after failed SSE deal - COO

By Tom Käckenhoff

ESSEN, Germany (Reuters) - Energy group Innogy will restructure its British retail business npower, already subject to a round of job cuts, after a planned joint venture deal with rival SSE fell apart, an Innogy executive said.

npower, one of the Britain's "big six" energy providers, said last week it would cut 900 jobs in Britain this year, or one in seven jobs, to cut costs as it faces an "incredibly tough" retail energy market.

"Overall, the British retail business is not a cause for joy. Market conditions have constantly worsened," Martin Herrmann, chief operating officer of Innogy's retail business, told Reuters. "We will restructure npower ourselves now," he said, speaking at a trade show in Essen.

SSE and Innogy in December scrapped plans to merge their British energy retail operations after the industry regulator proposed a cap on consumer bills, leaving both groups looking for other options to consolidate.

"The idea to create a pure retail business with SSE for 10 million customers, and buy all the electricity to do that, could not be realised," Herrmann said. "We would have had to fund a big part ourselves."

Npower will be absorbed by E.ON under a current deal with Innogy parent RWE, setting it up for a possible combination with E.ON's British retail business.


(Writing by Christoph Steitz; Editing by Riham Alkousaa and Jane Merriman)