Ovo Energy weighs up Shell takeover in bid to overtake Octopus and EON
Ovo Energy is weighing up a potential takeover of Shell’s household gas and electricity business – which could boost its books with 1.4m more customers.
It is expected to table an indicative offer this week to meet an informal deadline set by Lazard, which is overseeing the process on Shell’s behalf, as first reported by Sky News.
Any potential fee for the proposed takeover has not been disclosed.
Shell revealed back in January that it was launching a review of its household energy supply business in the UK, Germany and Netherlands.
If successful, the deal would mean Ovo would overtake Octopus and and become the country’s third biggest energy supplier with 5.4m customers – behind only EON and British Gas.
The latest potential M&A comes amid sustained acrimony in the industry, with multiple members of the Big Six jousting over Octopus’ takeover of Bulb in courtroom showdowns last year.
Ovo was among the rival bidders for Bulb, the collapse of which in November 2021 was the most significant among dozens of supplier failures.
It recently became the first major supplier to pass on savings to customers and offer a fixed tariff below the level of the industry price cap following the energy crisis.
Shell is also eager to sell its broadband customer book in the UK, which has about 500,000 customers.
Ovo does not have a presence in the domestic broadband market and would likely sell that part of the Shell business to a partner.
Ovo and Shell both declined to comment when approached by City PM