Bulb Energy: the difficult search for a buyer

“We do not want this company to be in this temporary state any longer than is strictly necessary,” Business Minister Kwasi Kwarteng told Parliament last November when announcing the £1.7 billion quasi-nationalization of Bulb Energy. Nearly six months later – amid mounting embarrassment and expense – the need to divest Bulb is becoming ever more urgent, said Gill Plimmer, Michael O’Dwyer and Jim Pickard in the financial times.

Last week, co-founder Hayden Wood revealed he was still being paid £250,000 a year to run the collapsed utility. Meanwhile, around £2million has been spent on bonuses to keep key employees. The total bill for taxpayers is estimated at £2.2 billion by next year, “making it the biggest government bailout since the Royal Bank of Scotland in 2008”.

Wood and his co-founder Amit Gudka each raised more than $4 million in 2018 The Sunday Times. But it was their “naivety” not to “properly secure themselves”. rising wholesale prices, the Bulb fell. Luckily for the government, a few bidders have come into sight. British Gas owner Centrica is offering to take over Bulb’s 1.7 million customers – “leaving behind the staff, the offices and the brand”. Abu Dhabi-based clean energy company Masdar has made a competing bid for the company as a whole.

Both tendencies are “unproblematic,” said Nils Pratley in The guard. Masdar has no experience of the UK energy retail market. And handing Bulb over to Centrica “would cement the market leader’s dominance” and mean paying the “dowry” it demands to cover energy costs. Ultimately, ‘Plan B’ – a complete dissolution of Bulb – may be the best way ‘to eliminate a developing political headache’. Meanwhile, “there is no justification whatsoever” for Wood’s “generous advance.”

https://www.theweek.co.uk/business/companies/956571/bulb-energy-the-troubled-hunt-for-a-buyer Bulb Energy: the difficult search for a buyer

Fry Electronics Team

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