(Bloomberg) -- National Grid Plc agreed to acquire PPL Corp.’s distribution grid business in the U.K. for 7.8 billion pounds ($10.9 billion), a move that will transform the company as it prepares for a low-carbon future.

At the same time, the network manager agreed to sell The Narragansett Electric Company in the U.S. to PPL for an equity value of $3.8 billion. National Grid also announced it intends to sell its majority stake in its gas grid business later this year.

National Grid is positioning itself as the global energy system shifts toward electricity and away from fossil fuels. Distribution grids, the local networks that feed directly into homes and businesses, are at the heart of the energy transition. Smart homes with electric heating systems, as many as 30 million electric cars and small scale renewable generation will all be connected to local grids in the coming decades.

Completion of the Western Power Distribution deal, which will be funded by fully committed bridge facilities, is expected within the next four months and completion of the NECO Sale is expected before the end of the first quarter of 2022. National Grid said it plans to start the sale process for NGG in the second half of this year.

“These transactions will be transformational for our U.K. portfolio,” chief executive officer John Pettigrew said in a statement. “The acquisition of WPD is a one-off opportunity to acquire a significant scale position in U.K. electricity distribution.

(Updates with CEO comment in the final paragraph)

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