The government has hit back at claims that the sale of collapsed energy supplier Bulb was unlawful and skewed in favour of Octopus.
On the second day of a judicial review hearing into the sale, lawyers representing the government said that allegations made by rival suppliers were all “without merit”.
The three-day judicial review hearing is currently taking place in the High Court, following claims made by Centrica, Eon and Scottish Power that Octopus was offered different terms to other suitors for the nationalised energy supplier and that the secretary of state could have secured a better deal.
In legal documents submitted by the Department for Business, Energy and Industrial Strategy – now DESNZ – the government argues that the M&A process, run by administrators Teneo and Lazard, was designed to “elicit the best terms available” from the market for the sale.
It said that the “process placed the onus on bidders to make any proposals for government support, rather than offering it proactively”.
This, it said, was to avoid “leading the market” towards requiring support, or as to the type or the amount of any support.
“Participants in the process were nonetheless aware that they could seek government support, but none were assured that government funding was guaranteed. The claimants ask the court to ‘infer’ that Octopus was given information unavailable to others, but there is no proper basis for such an inference,” it added.
“Despite the Claimants’ various attempts to suggest otherwise, it is apparent that they were each aware that Government financial support could be sought in relation to the purchase.”
On Tuesday (28 February) Paul Harris KC, representing Centrica, suggested during the first day of the hearing that the company had been “discriminated against” during the process.
He said: “We say that a transparent, fair, open, competitive process would have been one in which we would not have been discriminated against and we too would have received assurance of availability of government support received by Octopus…but it never happened, it never happened for any one of us.”
The hearing will conclude on Thursday (2 March) when Octopus will tell the court that it was not given any additional information about government support prior to its acquisition of Bulb.
The supplier, which has already onboarded a third of the Bulb customer base since completing the acquisition of its 1.5 million accounts in December, will also claim that it now expects the government to make a £1.2 billion profit on the deal.