Overview

• Ovo’s latest Companies House filing says there is “material uncertainty” over its ability to continue as a going concern after it fell short of the regulator’s financial resilience target.
• Ofgem’s post-crisis rules require suppliers to hold £115 in adjusted net assets per dual-fuel equivalent customer from 31 March to provide a shock-absorbing buffer.
• The company says it has agreed a capitalisation transition plan with Ofgem, but its timing and scope remain uncertain.
• Ovo has moved to strengthen its balance sheet by buying back its brand, repaying £400m of loans, drawing a £60m facility from Cheyne Capital, and working with advisers at Rothschild.
• Rivals have urged tougher limits on undercapitalised suppliers, while media reports say founder Stephen Fitzpatrick is exploring an equity raise of up to £300m and early talks with Scottish Power on a potential supply-business merger.