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npower sells subsidiaries to Telecom Plus

The energy giant has sold two of its subsidiaries to one of its rivals in a move that will see many customers move to an independent provider

Telecom Plus has cemented itself as a rising power in the energy market

Telecom Plus has cemented itself as a rising power in the energy market

Earlier this week, a report released by the BBC stated that some 150,000 consumers have moved to smaller companies and away from the big six in the wake of energy price rises which have been announced over the last month.

However, some will now find that their account has been moved to one of the fastest-rising firms in the independent sector, after the sale of Electricity Plus and Gas Plus to Telecom Plus.

770,000 accounts to move

The sale, which cost Electricity Plus some £196.5 million initially, as well as a deferred £21.5 million, will see the company gain some 770,000 accounts through its Utility Warehouse brand.

This is in addition to the extra 120,000 customers it said it has achieved organically in the space of the last month.

The £218 million deal to buy the subsidiaries from npower will see the firm immediately increase its gross margin by 4.25%. It has also signed a 20-year wholesale agreement as a part of the deal.

“We have benefitted from the widespread publicity which has followed the recent price rises announced by most of the ‘big six’ energy companies, which contributed towards a further acceleration in growth during October to over 12,000 net customers and 50,000 net services for the month – taking our total base to over 500,000 customers,” said Andrew Lindsay, chief executive of Telecom Plus.

Telecom Plus capitalises on good year

So far, 2013 has been a very positive year for Telecom Plus, showing just how smaller firms can compete against their bigger rivals in the big six.

As well as the sizeable number of consumers it has gained since the start of the price rise announcements last month, it enjoyed a strong six months prior.

In the six-month period to the end of September, the firm said it had welcomed some 33,908 new customers, which took its overall customer base to 494,940.

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