OVO Group is in discussions with SSE to acquire its UK-facing energy supply business, it has been revealed.
SSE confirmed in a statement issued over the weekend that it is talking to OVO about a possible sale of the business unit which, if complete, would see the challenger supplier take on SSE’s 5.7 million customer accounts.
Should the deal complete, OVO would storm into the ranks of the Big Six and become the country’s second-largest energy supplier by customer numbers.
SSE did, however, stress that no final decisions had been taken and transaction terms had yet to be agreed.
“The Board remains focused on securing the best long-term future for the business, its customers and employees, and for shareholders,” the statement read.
The Big Six have faced considerable customer churn and other external pressures in recent years, factors which SSE has not been immune to.
Late last year SSE and innogy pulled the plug on a proposed deal which would have seen SSE Energy Services merge with npower. That deal was more than a year in the making, but was ultimately shelved after Ofgem’s price cap on standard variable tariffs impacted on the financial particulars of the deal.
Since then SSE has been openly deliberating on what to do with its supply division, investigating other potential sales or the wholesale demerger and re-listing of the business.
Meanwhile, OVO has continued its meteoric rise and grown to become one of the foremost challengers to the UK’s Big Six.
Earlier this year the firm was boosted by technology giant MItsubishi acquiring a 20% stake in the business which was later revealed to value it at around £1 billion.
