Shell Energy Australia Pty Ltd has entered into a Scheme Implementation Deed to acquire 100 per cent of the shares in ERM Power (ERM), a commercial and industrial electricity retailer in Australia, for AU $617 million (less dividend adjustments payable by ERM).

Shell Australia’s Country Chair Zoe Yujnovich said the acquisition aligns with Shell’s global ambition to expand its integrated power business and builds on Shell Energy Australia’s existing gas marketing and trading capability.

“ERM will become our core power and energy solutions platform and this acquisition is a significant step forward in growing Shell’s integrated power business in Australia,” she said.

In the space of just 10 years since ERM entered the commercial and industrial electricity market, the company has grown to become the second largest energy retailer by load in Australia. The company is also an electricity generator, owning and operating two gas-fired generation plants. Gas-fired generation will play an important role in Australia’s transition to renewables.

The acquisition has received Foreign Investment Review Board and Australian Competition and Consumer Commission approvals and Shell’s offer is subject to court approval as well as ERM shareholder approval.

The acquisition is expected to be completed before the end of 2019.