British Gas plc will change its name to Transco International next April as part of the demerger proposals, say sources inside the company.
Transco International is British Gas’ pipeline business. The consumer division, British Gas Energy, will have a separate stock market listing next spring, provided an Extraordinary General Meeting of shareholders approves it.
British Gas is said to be concerned the City would not see BGE as a viable long-term investment.
The major sticking point for BGE, which includes British Gas Trading, British Gas Energy Centres and the Morecombe Bay gas fields, is the notorious “take-or-pay” contracts. By law, these oblige British Gas to buy in certain reserves at uncommercial prices. “It included the Morecombe Bay gas fields because shareholders would not take on BGE with only the take or pay contracts,” says the source.
Chairman Richard Giordano would be non-executive chairman of both companies for the interim. He is understood to be planning to leave next spring after British Gas plc is renamed.
However, Transco International and BGE are interim names for the two companies whose brand names are likely to be changed next year.
BGE is reportedly working with design outfit Wolff Olins on branding ideas for the new company. It is understood British Gas plans to drop its name in consumer markets, as well as from the holding company (MW September 6).