Ovo founder in line for £30mn payout ahead of Eon sale
Stephen Fitzpatrick to receive payment for brand royalty fees under arrangement with retail energy company he started
The founder of British household energy supplier Ovo is set to be paid a further £30mn in brand royalty fees from the company ahead of its sale to rival supplier Eon.
Stephen Fitzpatrick is owed the sum under an old arrangement through which an entity controlled by him charged Ovo millions of pounds annually for use of the Ovo brand, according to the company’s published accounts and people familiar with the matter.
It comes as Britain’s retail energy industry is under scrutiny over its financial stability and treatment of customers at a time of high energy bills connected to global wholesale prices and other pressures.
Ovo’s rival British Gas on Friday agreed to pay a penalty of £20mn and write off up to £70mn in customer debt after an investigation by the regulator concluded it had force fitted pre-payment meters in vulnerable customers’ homes in breach of licence conditions.
Ofgem is also investigating Ovo’s treatment of pre-payment meter customers.
Ovo supplies gas and electricity to around four million UK customers. It is part of the wider Ovo Group which also includes a technology arm, Kaluza, which is used by Ovo and licensed to other suppliers.
The companies announced last week that the energy supplier Ovo will be sold to German energy giant Eon, creating a supplier serving around 9.6mn households in the UK that will vie with Octopus Energy to be the country’s largest supplier.
The deal followed a lengthy search by Ovo for new investment as it tried to meet capital buffer requirements put in place by the energy regulator last year. This followed the collapse of around 30 suppliers due to soaring wholesale prices after Russia started squeezing Europe’s energy supplies in late 2021 and early 2022.
Ovo confirmed late last year it had yet to meet its capital buffer target, saying this created a “material uncertainty” over its ability to continue as a going concern.
It is not in breach of Ofgem’s rules, which give companies time to reach the target as long as they have a pathway to doing so.
Ovo was founded by Fitzpatrick in 2009, as part of a new wave of suppliers set up to challenge the dominance of the so-called Big Six including Eon and British Gas.
Between roughly 2015 and 2024, Ovo was charged millions of pounds each year — reaching a high of £40mn in 2023 — for use of the Ovo brand by Imagination Industries, a company controlled by Fitzpatrick.
The total amount charged over the decade amounted to more than £122mn, according to analysis of the company’s records, although the amount that has actually been paid so far appears to be around £50mn.
In January 2025, Imagination Industries — now known as Ovo Brand — was taken over by Ovo in return for 150mn £1 preference shares for Fitzpatrick in Energy Transition Holdings, by then Ovo’s parent company, adding to his ordinary shares.
Under that arrangement, Imagination Industries forgave outstanding amounts above £30mn owed by Ovo, and distributed the right to receive that outstanding £30mn to Imagination Industries Holdings — whose parent company, Imagination Industries Top Co, is controlled by Fitzpatrick, accounts show.
Fitzpatrick, 48, is a serial entrepreneur and investor who has also set up electrically powered “flying taxi” company Vertical Aerospace, owned the Formula 1 Manor Racing Team, and in 2020 bought The Roof Gardens, a private members club in Kensington, London.
The Roof Gardens took out a £15mn loan in April 2025 in part secured against money owed to Imagination Industries Holdings, according to accounts at Companies House for Kensington RG.
The price that Eon is paying for Ovo has not been disclosed. However, the Financial Times has previously reported it is in the region of £550mn-£590mn.
In total Fitzpatrick owned about 46 per cent of Ovo’s parent company Energy Transition Holdings at the time of the sale.
Fitzpatrick was announced in March as the chief executive of Kaluza, Ovo Group’s technology arm, which is not part of the deal with Eon.
Ovo and Fitzpatrick declined to comment.