Good Energy has once again hit back at Ecotricity as it today (18 August) publishes its response circular to Ecotricity’s offer of 340p per share.
Four key reasons have been given for Good Energy's board continuing to urge its shareholders to reject the offer, with the company describing Ecotricity as an “unfit owner with an unsuitable plan".
It reiterated that Ecotricity has been a loss-making business for the past four years - a reason given last week for rejection of the offer - with its latest published audited accounts showing a negative cash balance and a “significant” amount of outstanding bond debt.
Good Energy has now received written confirmation from six shareholders representing around 10.96% of the company’s issued share capital that they don't intend to accept the offer. Those written confirmations, when aggregated with Good Energy Shares held by the directors who won't be accepting the offer, represent approximately 15.30% of the company’s issued share capital.
Will Whitehorn, chair of Good Energy, said: "Ecotricity believes we can compete more effectively together as genuinely green suppliers in a market of similar-looking products. This is something Good Energy is already effectively doing by itself, as the only supplier with Uswitch Green Tariff Gold Standard accreditation for all its tariffs."
He also cited concerns over Ecotricity's corporate governance, on which he said the company has provided "very little insight".
This follows Ecotricity's founder Dale Vince launching a bid to appoint himself to the board of Good Energy in 2017 as a non-executive director, himself citing corporate governance concerns surrounding Good Energy, although the bid was later dropped.
Meanwhile, Good Energy today also pointed out differences in the two green suppliers’ tariffs, with Ecotricity’s cheapest tariff having been consistently more expensive than Good Energy’s cheapest tariff since October 2019, as well as differences in customer service ratings.
Good Energy said its 4.4 rating from customers on Trustpilot - compared to Ecotricity's of 3.9 - has been supported by investments in digital customer service platforms for home and business customers, with its domestic customers integrated onto Octopus' Kraken platform as part of a deal announced in October 2019 and its B2B customers integrated onto energy software supplier ENSEK’s Ignition platform.
This is an example of what Good Energy described as the successful delivery of its "modern and digital" business strategy, while describing Ecotricity’s strategy as "outdated and centralised", with a core element being to build its own new wind and solar sites.
This is something Good Energy moved away from several years prior in favour of signing power purchase agreements (PPAs) with small-scale renewable assets.
Good Energy's third and fourth reasons were that it is in a strong position for accelerated growth, with its increased stake in Zap-Map for instance helping it to benefit from the significant change in the areas of decentralised clean energy and electrified transport, and that the offer significantly undervalues Good Energy, a stance it has taken throughout the offer process.
The board is continuing to recommend that the remaining shareholders reject the offer by taking no action, with this following the rejection of three indicative offers made by Ecotricity for the company.
Current± has approached Ecotricity for comment.