British Gas owner Centrica has today announced that it will acquire council energy supplier Robin Hood’s customers for an undisclosed amount.
As a result of the sale, which will complete on 16 September, 250 staff will lose their jobs, the Telegraph reported.
Robin Hood’s 112,000 residential customers and its 2,600 business customers will be transferred over to the UK’s biggest energy supplier.
The firm, which counts former Labour leader Jeremy Corbyn amongst its customers, was set up by Nottingham City Council in 2015 in a bid to challenge the dominance of the “Big Six”.
However, a damning report from auditors at Grant Thornton earlier this summer showed that the firm had fallen into heavy debt.
According to the report, Robin Hood had lost a total of £34.4m by March 2019 despite receiving £43m of public cash and £16.5m in loans.
A review into the firm’s governance was launched, but council officials have concluded that selling the company was the best option.
Council leader David Mellen said: “Given the current economic climate and the further levels of investment needed to enable the company to compete in an extremely difficult market, the review concluded that a sale was the right option”
“It provides the best possible deal for the Council and city residents and reassurance to customers that they are transferring to a large, well established company.
“We know this is a very sad day for the business and its employees who have played a part in creating a more dynamic and customer orientated market for all energy consumers.
Centrica chief executive Chris O’Shea said: “As well as our actions to simplify and modernise our business, we are focused on returning to profitable growth in our core markets and investing in value generating opportunities.
“Our customers are at the heart of everything we do, and we are delighted to welcome Robin Hood customers to British Gas.
“We are pleased to be able to offer every customer moving to British Gas a tariff which means their price will not be any higher and, importantly, they will be supplied with green electricity and have access to a range of other benefits – such as British Gas Rewards with free energy days and exclusive offers on services such as boiler cover.”