Overview

• Exploratory talks launched in June aim to merge the residential gas and electricity operations of Spanish-owned Scottish Power and founder-led Ovo Energy.
• The proposed combination would serve about 6.4 million households across the UK, making it the third-largest supplier behind British Gas and Octopus Energy.
• Both parties stress the process is at an early stage with no binding agreement expected until later this year after further due diligence.
• Ovo has hired Rothschild to advise on a parallel fundraising that could raise roughly £300 million to support expansion and potential transaction costs.
• The merger talks coincide with heightened regulatory scrutiny over customer-service fines and recent leadership changes under chair Justin King and CEO David Buttress.