Good Energy battle heats up, as Ecotricity raises offer 18% to £4.00 per share


The takeover battle between Britain’s two oldest ‘pure’ green power pioneers intensified at lunchtime today (Thursday 16th), as Dale Vince’s Ecotricity raised its bid for Good Energy by 18%.

Stroud-based Ecotricity’s new bid of 400 pence a share values the target’s equity at £69.9 million. Last night Good Energy’s closing price of 328 pence valued it at £55.6 million.

Both firms operate a ‘purist’ model of exclusively renewables-sourced power, both drawing primarily on PPAs and supply agreements with independent wind and solar generators.   For its gas retailing, Ecotricity pays to offset emissions from the 95% it buys in , thereby claiming carbon neutrality

Latest returns put Good Energy’s customer accounts at 274,600, including  142,900 business customers.  For the six months to June, this week it revealed pre-tax profits of  £4.8 million  on steady-state turnover of £68.4 million.

Vince set up Ecotricity, a not-for-dividend enterprise, under its former name in April 1995.  Good Energy was incorporated four years later.  Ecotricity does not disclose customer numbers. It first bought shares in its rival in March 2016.

Launched on 15 June, the 340 pence bid by Dale Vince’s company has been roundly rejected three times before today by Good Energy’s board.  Under Stock Exchange rules, the 15 June bid would have lapsed today, the 60thday.   Good Energy shareholders have until 10 October to decide on the latest offer.

Consolidation to compete better in the UK’s crowded power market, is at the root of Ecotricity’s increased offer. As today’s bid says:

“Ecotricity believes there is strategic merit in combining its operations with those of Good Energy, not least from ageographical and capabilities perspective, both being complementary.

“The proposed combination would create a green energy supply entity of more significant scale with more roundedcapabilities, better able to compete with the Big Six and the raft of newer entrants – many of whom make green energyand environmental-related claims in their marketing.

The battle has been growing increasingly acrimonious, with the Chippenham-based firm slating Ecotricity’s approach first as ‘opportunistic’ and coming from an ‘unfit owner’ for its rival

In a statutory declaration this morning, made before its 400 pence bid, Ecotricity revealed it held a total of 27.1% of its prey’s equity.

Market reaction

In a defence issued this morning, before Ecotricity’s increased bid, Good Energy chair Will Whitehorn reminded investors that Ecotricity had made losses each year since 2017

“Good Energy has shown strong growth in the first half of this year, and the nature of the rapidly growing markets in which the Company operates – clean energy and transport – mean there is significant headroom for more.

“This ..demonstrates how unfit an owner Ecotricity would be for Good Energy”, Whitehorn told investors.

“This hostile offer, if successful, would risk severely damaging the Company’s potential for further growth, and deny our investors the opportunity to be a part of it.

By 14:30 hours, Good Energy’s price on AIM stood at 388.0 pence, up 17.93% on the day.


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