Ovo founder Stephen Fitzpatrick cuts ties with controversial parent firm

Scrutiny: Boss Stephen Fitzpatrick

Billionaire Stephen Fitzpatrick has severed corporate ties between Ovo Energy and its controversial parent firm Imagination Industries.

The founder and chief executive of Ovo Energy has restructured his labyrinthine empire after heightened scrutiny of his finances, including big inter-company loans.

Up to spring this year, Ovo – Britain’s fourth largest energy supplier with over four million customers – was owned by Imagination, Fitzpatrick’s investment vehicle.

Imagination controlled Ovo alongside his other ventures, including glitzy West London party venue Kensington Roof Gardens.

This newspaper revealed last year that Imagination made £27 million in loans to its directors. It also handed nearly £10 million in loans to Fitzpatrick’s US-listed flying taxi firm Vertical Aerospace, which has warned of ‘material uncertainty’ in its future as a going concern without new capital. There is no suggestion the loans were unlawful or breached financial rules.

Fitzpatrick, a Belfast-born former City trader, was grilled by MPs on intercompany loans and payments early last year. MPs called on him to ‘open the books’ at Imagination. But last week Ovo said it ‘no longer has any ties’ to Imagination.

The gas and electricity supplier said it is now held by a standalone group called Energy Transition Holdings, where Fitzpatrick is the majority owner.

It comes after Ovo posted an annual loss of £1.3 billion in a ‘challenging year’. The firm also confirmed that two of its shareholders, Mayfair Equity Partners and Morgan Stanley Investment Management, had ploughed an additional £200 million into the business.

Fitzpatrick, a serial entrepreneur who once owned a Formula 1 team, founded Ovo in 2009. He bought Kensington Roof Gardens, once owned by Richard Branson, in 2020 and is lavishing millions of pounds on a luxury makeover.

Ovo said it was the right time to change ownership as Imagination is an incubator for start-ups and Ovo no longer falls in that category.