Street Talk – 13 January 2020
Sutton family backs junior energy retailer
Sarah Thompson, Anthony Macdonald and Tim Boyd
The Sutton car dealership family in Sydney has emerged as the majority backer of junior energy retailer Sumo, allowing it to embark on a new growth drive under former Click Energy managing director Dominic Drenen.
The $10.5 million recapitalisation, to be announced as early as Tuesday, has seen Sutton Group take majority control of Sumo, while former major shareholder and chairman Damien Waller, the co-founder of iSelect, has exited.
The restructuring follows an unsuccessful sales process run last year by PwC which attracted interest from existing retailers but not at a satisfactory price.
Drenen will be aiming to replicate his track record at Click, where shareholders including Los Angeles-based Angeleno Group, sustainability investor RobecoSAM in Zurich and Melbourne-based CleanTech Ventures saw an 11-fold increase from their $11 million investment in 2013 when the business was sold to Amaysim in 2017.
The Sutton car dealership family has struck a deal to recapitalise a junior energy retailer. Daniel Acker
Sumo, with over 70,000 customers and over $100 million in revenue, calls itself the market leader in “triple play” utility sales that bundle electricity, gas and broadband.
In a difficult retailing market since the introduction of default market offers last July, Drenen is planning to develop channels with partners to add customers. Sumo expects to enter the NSW gas retail market in March and to start retailing power in south-east Queensland early next financial year.