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Ovo Energy has launched authorized motion in opposition to Talktalk over a dispute stemming from a failed broadband customer switch, including strain on each firms as they battle monetary challenges.
The declare centres on a 2022 deal during which Ovo bought a telecoms enterprise, initially acquired by its takeover of SSE Energy Services , to Talktalk, transferring round 135,000 broadband prospects.
Under the settlement, Talktalk paid an upfront sum and dedicated to additional funds tied to efficiency milestones.
However, the deal unravelled after massive numbers of consumers left the service, undermining the worth of the transaction.
TalkTalk has since refused to pay the remaining sum, prompting Ovo to pursue authorized motion.
Dispute comes amid monetary pressure
The lawsuit lands at a delicate second for Ovo, which is searching for to shore up its funds by a £300m fundraising and exploring a possible sale of the enterprise.
The provider, which serves round 4 million prospects, has confronted mounting scrutiny since failing to satisfy stricter monetary resilience checks launched by regulator Ofgem following the 2022 power disaster.
Bankers at Rothschild have been appointed to supervise the method, with choices together with new funding or a sale of the core enterprise. Ovo has additionally launched into a cost-cutting drive aimed toward saving tens of tens of millions of kilos.
The firm reported losses of £135m in 2024, however it paid £27m in the identical yr to an organization owned by founder Stephen Fitzpatrick, linked to a longstanding model licensing association that was later purchased out in a £150m deal.
Meanwhile, the broadband group is grappling with round £1.4bn of debt, rising curiosity prices and ongoing losses, which have compelled it to depend on repeated emergency funding from shareholders, together with govt chairman Charles Dunstone.
In November 2025, Talktalk Group mentioned it might start a proper course of to discover new possession constructions after separating its shopper and PXC companies from the broader group.
The firm has appointed PJT Partners to advise on strategic choices, with discussions ongoing and potential outcomes together with a sale of the group as an entire or disposals of particular person divisions.
