Takeover of failed energy firm Bulb is completed

Octopus Energy has completed its acquisition of the collapsed energy supplier Bulb - even though legal challenges to the deal remain ongoing.

Bulb, which has about 1.6m customers, was the largest of more than 30 energy firms that went under in 2021 after a sharp rise in wholesale gas prices.

It was bailed out by taxpayers and had been run by administrators until now.

But rival suppliers say the sale to Octopus was unfair and have launched legal action that could overturn it.

For now, the takeover means Octopus is among the biggest energy suppliers in the UK.

Boss Greg Jackson said: "This starts to bring an end to the huge financial exposures for taxpayers and paves the way for a better and more certain future for Bulb's staff and customers."

The value of the Octopus Energy deal has not been published but the BBC understands the firm paid the government between £100m and £200m.

However, the Office for Budget Responsibility (OBR) has estimated that the rescue of Bulb could cost tax payers up to £6.5bn - making it the biggest bailout since the bank rescues during the 2008 financial crisis.

Government officials say the final bill is likely to be much lower, with the Department for Business, Energy and Industrial Strategy adding it could be less than £4.5bn depending on energy prices this winter.

Rival suppliers Eon, Scottish Power and Centrica - which owns British Gas - have argued the Bulb sale involved unfair government subsidies and asked for a judicial review.

This is a type of court case that allows the legality of a government decision to be challenged.

In written submissions to the High Court in November, British Gas said there had been an "abject lack of transparency" about the commercial terms of the deal.

And Scottish Power said the process had been "defective", calling for it to be re-run to allow for alternative bids.

But Bulb's administrators rejected the arguments and said that other energy companies had decided to "walk away" from the sale process.

The case is expected to be heard by a judge in February and it is unclear what will happen with the transfer of customers if the deal is reversed by the courts.