OVO Energy to Acquire SSE Energy Services in a Landmark Transaction

Source Press Release
Company Ovo Group LtdSSE Plc 
Tags Asset Deals, Deals, Power
Date September 13, 2019

● OVO has agreed to acquire SSE’s GB household energy and related services business, which includes the customers, operations and employees for energy, telecoms and home services. Together, the companies currently serve almost 5 million customers.

● The acquisition will allow OVO to bring its market leading energy technology, excellent customer experience and great value to millions more customers.

● OVO has been voted Supplier of the Year four out of the last five years by uSwitch. In 2019 it was ranked first in six categories including Best Customer Satisfaction.

● OVO recently announced an investment from Mitsubishi Corporation in exchange for a 20% minority stake in order to fund future growth.

The UK’s leading independent energy supplier OVO Energy has agreed to acquire SSE’s household energy and related services business for £500 million, comprising £400 million in cash and £100 million in loan notes, marking a significant moment for the energy industry. Together, the companies serve almost 5m households across the UK.

The acquisition will accelerate OVO’s ambition to provide clean, affordable energy for everyone. Combining SSE’s scale and OVO’s technology capabilities will enable millions more customers to experience the latest technology to decarbonise their homes, while keeping their costs down and continuing to receive great service.

Stephen Fitzpatrick, CEO and Founder of OVO said:

“This transaction marks a significant moment for the energy industry. Advances in technology, the falling cost of renewable energy and battery storage, the explosion of data and the urgent need to decarbonise are completely transforming the global energy system.

“For the past three years OVO has been investing heavily in scalable operating platforms, smart data capabilities and connected home services, ensuring we’re well positioned to grow and take advantage of new opportunities in a changing market.

SSE and OVO are a great fit. They share our values on sustainability and serving customers. They’ve built an excellent team that I’m really looking forward to working with.”

Alistair Phillips-Davies, CEO of SSE, said:

“We have long believed that a dedicated, focused and independent retailer will ultimately best serve customers, employees and other stakeholders – and this is an excellent opportunity to make that happen. OVO shares our relentless focus on customer service and has a bold vision for how technology can reshape the future of the industry. I’m confident that this is the best outcome for the SSE Energy Services business.”

CEO Stephen Fitzpatrick founded OVO in 2009 to transform the energy market with cheaper, greener and simpler energy. Thanks to a focus on customer service and the development of new, clean energy technologies, the company has grown since then to become the largest UK independent energy supplier, now serving 1.5 million customers. In the last year, OVO has increased its UK customer base by 50% and opening operations in France and Spain. OVO has plans to open in Australia, Germany and Italy next year.

Earlier this year, OVO has secured a significant strategic investment from Mitsubishi Corporation. This has allowed OVO to invest even further in the technology required to help us transition to a zero-carbon future. For example, OVO has launched the world’s first domestic vehicle-to-grid charger, it is developing the software required to integrate millions of electric vehicles onto the grid, and it is investing in dynamic battery storage to allow homes to sell energy back to the grid.

The deal is subject to regulatory approvals which we expect will take a number of months. For the time being, both companies will continue to operate independently as separate entities and serve their respective customers.

If this transaction goes ahead, the leadership teams from both companies will be working together to plan carefully how SSE is brought into the OVO family and onto its systems and platforms. OVO has negotiated rights to use the SSE master brand under licence for a transitional period, and acquired regional brands as part of this transaction and intends to maintain them for the immediate future.

Source: EvaluateEnergy® ©2020 EvaluateEnergy Ltd