Canada-based Just Energy Group has sold its UK operation, Hudson Energy Supply UK, to Shell Energy Retail.

Hudson UK supplies around 200,000 UK residential customers with gas and 100% renewable electricity through its residential trading arm, Green Star Energy. It also provides gas and 100% renewable electricity contracts to around 2,000 commercial customers.

Just Energy said the sale would allow it to avoid “significant capital investments that would otherwise have been required in the short term to support the UK operations and to further grow the UK business”. Shell Energy will pay £2 million at closing, along with up to £8.5 million in Capacity Market payments if the CM is restored within a specified period of time. Until completion, both companies will continue to operate independently. On completion, Hudson UK will operate as a wholly-owned subsidiary of Shell Energy Retail.

The transaction is subject to merger control approval, and is expected to close by the end of 2019.