Octopus takes on Bulb’s 1.5m customers

The government has approved a deal between the administrators of Bulb and Octopus Energy, for the Greg Jackson-led company to acquire the failed supplier.

Despite a last-minute bid by Ovo Energy, which claimed to be able to fund the purchase with no government support, Octopus has been chosen to take on Bulb’s 1.5 million customers and 650 staff.

Bulb’s assets will be transferred into a new entity which will then be sold to Octopus but remain a ringfenced business in the short term. The government will provide financial support to procure energy for Bulb’s customers this winter, with a profit-sharing agreement put in place until Octopus has paid off the debt. This agreement could be in place for up to four years and will see payments to shareholders of the wider Octopus group from the ringfenced business restricted until government funding has been repaid in full.

Announcing the deal, Octopus insisted it was paying a higher price per customer than suppliers typically did to take on any of the 29 suppliers that have failed since last September.

It is understood the total cost of nationalising Bulb is likely to be around £4 billion, including the costs over this winter.

The transfer is likely to take place on 11 November and become effective a week later.

It takes the total number of customers served by Octopus to just under five million.

Business and energy secretary Grant Shapps said: “This government’s overriding priority is to protect consumers and today’s sale will bring vital reassurance and energy security to consumers across the country at a time when they need it most.

“This is a fresh start and means Bulb’s 1.5 million customers can rest easy, knowing they have a new energy home in Octopus.

“Moving forward, I intend to do everything in my power to ensure our energy system provides secure and affordable energy for all.”

Jackson said: “We take our responsibilities very seriously. We will work unbelievably hard to deliver value for taxpayers and to look after Bulb’s staff and customers.

“We started off as rivals but shared the same mission – driving a greener, cheaper energy system with people at the heart. We know how important this is to Bulb’s loyal customers and dedicated staff, and are determined that Octopus can provide them with a stable home for the future.”