NEW YORK, Jan 11 (Reuters) – Activist investor Elliott Management Corp holds a large position in PPL Corp, a source familiar with the matter said on Wednesday, the same day the U.S. utility unveiled an updated business plan targeting higher dividends and earnings growth.
Elliott is one of the best known names in investor activism, and has pushed for changes at numerous U.S. power companies in recent years, including Duke Energy Corp, Evergy Inc and Sempra Energy.
Its position in PPL would make it a top-10 investor in the Allentown, Pennsylvania-based utility, the source said, without disclosing the size of Elliott's stake.
Talks between PPL and Elliott have been ongoing and there is no imminent threat of the activist publicly challenging PPL's management and board, with Elliott supportive of PPL's business plan, the source added.
Asked by analysts whether an activist had shaped PPL's actions, Chief Executive Vincent Sorgi declined to comment beyond saying "we've been talking about these updates with investors really as we moved through last year".
A spokesperson for PPL Corp declined comment, as did an Elliott spokesperson.
Under the updated business plan, PPL foresees earnings per share (EPS) this year in the range of $1.50 to $1.65 per share, with the midpoint being a 7% increase on its 2022 earnings. It also extended its target to grow EPS and dividends annually by between 6% and 8% to 2026 – with its next quarterly dividend rising 7% to $0.24 per share.
The utility, serving 3.5 million customers across states including Pennsylvania, Rhode Island, and Kentucky, also said it would add $2.5 billion to its capital investment plan, to support grid modernization and resiliency, and boost its cost savings target to $175 million annually.
Meanwhile, Linda Sullivan, a veteran utilities executive, has join PPL's board, the company's statement added.
It is the first time Elliott has emerged in a utility's stock since Jeff Rosenbaum, who led the investor's activity in the sector, left the firm.
Bloomberg News first reported Elliott's position in PPL. (Reporting by David French in New York; Editing by Chizu Nomiyama)
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