Bristol City Council has confirmed it has sold part of its Bristol Energy business to Yü Energy for £1.34m.
The business base part of Bristol Energy has been sold to the specialist business energy supplier, which currently operates more than 9,000 business meters around the country.
The business base customer book consists of a broad range of B2B gas and electricity supply contracts running for up to three years, servicing a range of public sector and business customers, including the council itself.
The local authority agreed to sell the company in June, after the current mayor of Bristol, Marvin Rees admitted it had faced unprecedented challenges since being established by his predecessor.
Earlier this year, the council commissioned Ernst & Young to conduct a full and thorough assessment of Bristol Energy’s structure and future business viability.
The majority of Bristol Energy’s business energy staff will move across to Yü Energy as part of the sale.
Yü Group paid £1.24m in cash on completion of the deal and, as part of the acquisition, has acquired £1.0m of receivables of which the majority is due for payment to Yü Group in August 2020.
A further £100,000 is payable by the Group deferred for three months. In addition, the group has assumed liabilities totalling £580,000 payable in August 2021.
‘We are delighted to have successfully executed the purchase of Bristol Energy’s B2B Book post extensive due diligence,’ said Yü Group chief executive, Bobby Kalar.
‘The transaction allows the group to layer in a fantastic customer base to our accelerating organic portfolio and increase value by offering additional products and services not available previously.
‘This acquisition forms part of our strategic growth plan, leverages our disciplined controls and scalable technology platform and highlights the Group’s ability and appetite to scale,’ he added.
‘Immediate opportunities to synergise the customer book will further our ability to extract value while keeping overheads down. Management’s objective will be to transition Bristol Energy customers onto our platform quickly and seamlessly while enhancing value and creating a proven template for further value additive potential acquisitions.
‘I remain convinced that there is a substantial market opportunity for Yü Group. With significant organic growth potential and a strong balance sheet, we see a great opportunity to increase market share and drive sustainable, profitable growth, creating value for all our stakeholders.’
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