Flowgroup's subsidiary signs Shell deal

Alternative energy technologies supplier Flowgroup said one its subsidiary has signed a five-year deal with Shell Energy Europe.

Under the terms of the deal, Shell will provide Flow Energy Limited with access to wholesale energy - gas and electricity – which will potentially enable “significant” growth in the company's energy supply business and increase the customer base for its mCHP Flow boiler.

The deal, which could be extended by Shell for further three years, will see the oil giant receive a warrant to subscribe for shares in Flow Energy equivalent to 10% of the growth in value of the group from the day of the agreement until after a liquidity event or on termination of the deal.

Group chief executive Tony Stiff said the agreement would provide Flow Energy with a readymade route to market and with a broader range of consumers.

“We believe that the current domestic energy market is favourable to the growth of smaller suppliers, and that the value ascribed by the market to an energy customer is rising as the potential for the cross-selling of a wider variety of energy related products and services has increased,” he added.

Flowgroup shares were up 3.10% to 15.98p at 0938 GMT on Wednesday.