Octopus hits back at challenge to Bulb deal arguing it was more ‘nimble’ than rivals

Octopus hits back at challenge to Bulb deal arguing it was more ‘nimble’ than rivals

3 Mar    Finance News, News

Octopus Energy has hit back at the energy firms challenging its takeover of Bulb Energy, with the supplier’s lawyer arguing in court today that the company was simply more “nimble” and “saw an opportunity that others missed” in its deal-making with the government.

Its lawyer argued that the rival suppliers were not concerned about how to advance public interest in the energy crisis, and were challenging the deal because it went against their commercial interest – with Octopus proving to be an increasing threat to their market share.

“These claimants are members of what is known as the Big Six, and by contrast Octopus was established in 2016 and its market share has steadily increased,” he said.

The company was defending its takeover of Bulb in the final session of a three-day judicial review at the Royal Court of Justice in London, which has involved three other Big Six suppliers – EON UK, Scottish Power and British Gas owner Centrica – alongside the government and administrators Teneo.

The case is between the government and the three rival energy firms, but Octopus contributed to proceedings today as an interested party.

Octopus’ takeover of Bulb was finally greenlit in court last year and makes the energy firm the third biggest in the UK with nearly five million customers, behind just two of the claimants in terms of overall market share.

The deal for Bulb includes a nine-figure sum, a profit-share agreement with the government involving the 1.6m customers and hedging support in the form of a loan.

However, the takeover is being challenged in a judicial review, raising the prospect of fines, compensation or the deal potentially being revoked if its challengers are successful.

British Gas, EON and Scottish Power have consistently argued the government unlawfully committed billions of pounds of taxpayers’ money to prop up Bulb, without considering consequences to the wider energy market.

During this week’s proceedings, British Gas owner Centrica has raised concerns over the lack of transparency over the deal and argued throughout legal proceedings that Octopus was offered terms by the government that were not explicitly made available to other suppliers.

This is an argument Octopus disputes.

Its lawyer today argued the rival companies were well-resourced players who were “able to enter negotiations if it was in their interests to do so” and it was commercial reasons that meant they did not proceed with bids to match Octopus.

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