Ovo Energy has completed its transformational takeover of the household energy arm of Perth-based utility SSE, propelling it into the top flight of UK power suppliers.
The move follows last month’s clearance for the deal from the UK competition watchdog after officials said they would not launch a second-phase investigation into the landmark £500 million acquisition.
Britain’s traditional Big Six energy providers have been facing increased pressure from challenger suppliers such as Ovo in recent years.
After encouragement from the regulator, dozens of new energy companies set up, often offering more attractive deals than the slow-moving incumbents, though several have since gone to the wall.
The deal sees SSE, formerly Scottish & Southern Energy, hold onto its electricity generation arm and its grid operations. It plans to treble its production of renewable energy by 2030, to some 12 gigawatts.
Through its retail brands, Ovo will now serve almost five million customers.
With the acquisition completed, the leadership teams from both companies are set to collaborate on a more detailed plan on how to bring the two businesses together, creating “one unified team”.
Stephen Fitzpatrick, chief executive and founder of Bristol-based Ovo, said: “Today is an exciting day. It marks the end of one chapter for Ovo but, more importantly, the beginning of the next one together with SSE Energy Services.
“We have an integration plan that leaders from both companies have collaborated on since September. There is a lot of work to do to bring the two businesses together, but we have a really strong combination of great talent, technology and customer centricity that will enable us to succeed.”
He added: “SSE’s history of excellence at scale combined with Ovo’s innovative technology and our ‘Plan Zero’ commitments mean that together, as one team, we can bring millions more people with us on our journey towards zero carbon living.”
Alistair Phillips-Davies, chief executive of SSE, said: “We are very pleased to have completed this transaction, which we firmly believe is the best outcome for the business, its customers and its employees.”
SSE has thousands of staff within the energy services division who are set to transfer to Ovo – founded in 2009.
In November, SSE pledged to deliver on its dividend commitments despite trimming its interim shareholder payout after posting a double-digit hike in operating profit.
Reporting results for the six months to the end of September, the group also said it was “progressing well” with its switch to a low-carbon strategy. Adjusted operating profit rose 14 per cent to £491.9m on the back of “generally wet and windy weather”.