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| Npower sells some subsidiaries to Telecom Plus for £218m | Npower sells some subsidiaries to Telecom Plus for £218m |
| (about 2 hours later) | |
| The energy firm Npower is selling some subsidiaries to Telecom Plus, which trades as Utility Warehouse, for £218m. | The energy firm Npower is selling some subsidiaries to Telecom Plus, which trades as Utility Warehouse, for £218m. |
| Telecom Plus will officially take over contracts to supply gas and electricity to 770,000 accounts as part of the deal. | |
| Customers are being told they will see no change to services. | Customers are being told they will see no change to services. |
| If the sale is approved by Telecom Plus shareholders and the Office of Fair Trading, Npower said it expected to complete the sale by January next year. | If the sale is approved by Telecom Plus shareholders and the Office of Fair Trading, Npower said it expected to complete the sale by January next year. |
| Telecom Plus said the deal would improve energy margins by 4.25% and allow the company to offer more competitive tariffs. | Telecom Plus said the deal would improve energy margins by 4.25% and allow the company to offer more competitive tariffs. |
| It ensures a 20-year gas and electricity contract with Npower. Telecom Plus provides gas, electricity, fixed-line telephone, broadband internet and mobile services. | |
| 'Big seven' | 'Big seven' |
| Shares in Telecom Plus were up 15% on the news, making it one of the top percentage gainers on the London Stock Exchange. | Shares in Telecom Plus were up 15% on the news, making it one of the top percentage gainers on the London Stock Exchange. |
| Npower boss Paul Massara said Britain was "well on its way to having a big seven rather than a big six". | Npower boss Paul Massara said Britain was "well on its way to having a big seven rather than a big six". |
| He said: "In one move we have helped to create the biggest independent competitor in Britain's household energy supply market." | He said: "In one move we have helped to create the biggest independent competitor in Britain's household energy supply market." |
| "This is good for competition and good for consumer choice." | "This is good for competition and good for consumer choice." |
| Telecom Plus's executive chairman, Charles Wigoder, said: "This is a transformational deal for the company, delivering significant earnings enhancement, a revised and improved twenty year supply agreement with Npower and the opportunity for us to provide even more competitive energy prices to our customers in future." | Telecom Plus's executive chairman, Charles Wigoder, said: "This is a transformational deal for the company, delivering significant earnings enhancement, a revised and improved twenty year supply agreement with Npower and the opportunity for us to provide even more competitive energy prices to our customers in future." |
| Since the start of October, more than 150,000 people have switched themselves to smaller energy firms amid a spate of price rises from five of the "big six" energy and gas firms and political debate about how the firms set prices. | Since the start of October, more than 150,000 people have switched themselves to smaller energy firms amid a spate of price rises from five of the "big six" energy and gas firms and political debate about how the firms set prices. |
| Small energy firms account for about 3% of the market. | Small energy firms account for about 3% of the market. |
| Neil Shah, analyst at Edison Investment Research, said the acquisition was a major strategic move for Telecom Plus. | Neil Shah, analyst at Edison Investment Research, said the acquisition was a major strategic move for Telecom Plus. |
| He said: "With some reinvestment in price, the company is now even better placed to take advantage of consumer discontent around the big six." | He said: "With some reinvestment in price, the company is now even better placed to take advantage of consumer discontent around the big six." |