PPL Corp Divests U.K. Utility Business; Plans to Reduce Debt with Proceeds

PPL Corporation (PPL) has completed the divestiture of Western Power Distribution (WPD), its U.K. utility business, to National Grid for about $10.7 billion in cash.

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The U.S.-based utility holding company has set aside about $6.6 billion to build its balance sheet position and focus more on U.S. operations. The company also plans to reduce its outstanding debt by about $3 billion.

Notably, PPL Corporation is also making progress to acquire Narragansett Electric Company from National Grid for about $3.8 billion. The deal is likely to close in March 2022. (See PPL Corp. stock analysis on TipRanks)

President and CEO of PPL Corporation Vincent Sorgi said, “The sale of WPD and the acquisition of Narragansett Electric will better position PPL for long-term growth and success. The move will give us the financial flexibility to invest in sustainable energy solutions.”

In May, RBC Capital analyst Shelby Tucker maintained a Hold rating and a price target of $30 (2.53% upside potential) on the stock. Shelby anticipates PPL Corporation to break even in the second quarter of 2021.

The rest of the Street is cautiously optimistic on the stock with a Moderate Buy consensus rating based on 2 Buys and 5 Holds. The average analyst PPL Corp. price target of $32.33 implies 10.49% upside potential from current levels. Shares have jumped 4.8% over the past six months.

TipRanks data shows that financial blogger opinions are 90% Bullish on PPL compared to the sector average of 72%.