Competition watchdog launches merger inquiry into OVO’s acquisition by E:ON
South West-based power supplier OVO Energy’s acquisition by German giant E.ON is to be investigated by the competition regulator.
The Competition and Markets Authority (CMA) has confirmed it will launch a phase one inquiry into the deal, announced in May and approved by OVO.
The acquisition would create a combined utility group supplying nearly 10m customers across the UK and with a market share of around 27%.
The CMA had invited comments from interested parties in July. It said the phase one investigation would assess whether the deal posed a “realistic prospect of substantially lessening competition” in the UK energy retail market.
The deadline for the inquiry decision has been set for 28 October.
The CMA said it would seek to determine its investigation “as quickly as possible” but added that the statutory deadline could be extended in certain limited circumstances.
Speculation grew earlier this year that E.ON was poised to pounce for OVO, which was launched in Bristol by entrepreneur Stephen Fitzpatrick in 2009.
The firm grew rapidly as a challenger to the industry’s dominant Big Six energy groups, acquiring CORGI HomePlan nine years ago as it rapidly transitioned from a core energy supplier towards becoming an integrated-enabled energy services company.
That reached its peak in 2020 with its £500m takeover of SSE’s retail business, which added around 3.5m customers, taking its total to 5m. It also made it the UK’s second-largest energy supplier behind British Gas.
However, integration issues, tougher regulation and volatile wholesale markets impacted on OVO’s performance and it made a £135m loss in 2024.
Last year it warned of a “material uncertainty” over its ability to continue trading and earlier this year was said to be looking for a lifeline from a suitable buyer.
At the time the proposed takeover, Fitzpatrick said the energy retail market had become more regulated, more capital intensive and increasingly dependent on long-term investment and scale since OVO’s launch.
“In that context, bringing OVO together with E.ON is the right next step for customers, for colleagues, and for the long-term commitment that decarbonisation requires,” he added.
