Over the past 12 months, the UK energy and infrastructure M&A sector has remained resilient but increasingly selective. Activity improved through late 2024 and into 2025 as financing markets stabilised, and sellers adjusted price expectations. Overall volumes were slightly softer than a year ago, with a tilt toward platform build‑outs and more disciplined pricing.

Inflation has eased from its peak, but the cost of debt remains elevated versus pre‑2022 levels. This continues to push buyers to favour-contracted, inflation‑linked cash flows and to sharpen their focus on downside protection, counterparty quality, and merchant‑price exposure.

Geopolitical tensions (in Ukraine and Gaza, and broader trade frictions) have reinforced the premium on energy security, supply-chain resilience and domestic infrastructure sovereignty. That has supported interest in grid, storage and digital infrastructure (including data centres and fibre), with AI‑driven demand materially accelerating deal flow in data centres, fibre optics, and adjacent digital‑infrastructure subsectors; while some large offshore wind and new‑build renewable processes progressed more cautiously amid supply‑chain and planning/grid‑connection constraints.

With respect to how the UK compares to the global pace – the UK remains a highly attractive jurisdiction but deal volumes have been modestly weaker than some major global markets. That said, the UK broadly aligns with global structural themes – decarbonisation, electrification, digital demand, grid/resilience – so while the pace in certain segments may lag, investor appetite remains strong, and the UK continues to feature as a strategic destination for energy and infrastructure M&A.

In short, the market is less about rapid boom growth and more about quality, holding discipline and platform building. Challenges remain (inflation, cost of capital, geopolitical and supply-chain risk, planning/grid bottlenecks), but the strategic imperative behind the sector (transition to net zero, energy security, digital infrastructure) means that the UK continues to present considerable opportunities for buyers and sellers.

Over the past year, UK energy and infrastructure have been shaped by regulatory change, ESG expectations, and macroeconomic headwinds. Policy continues to prioritise energy transition, with momentum in grid reinforcements, and energy storage.

However, the reality on the ground has been more complex, as policy developments have both accelerated ambition and complicated delivery. The expanded Contracts for Difference regime, supporting investment in low-carbon electricity generation, and the creation of Great British Energy – backed by GBP8 billion to act as a strategic investor and help accelerate the UK’s clean-energy transition – signal an increased state role in catalysing capital into priority technologies and regions. Meanwhile, inflation, higher financing costs, supply‑chain volatility, and geopolitical risk have slowed or reprioritised projects, challenging the traditional infrastructure model of stable, inflation‑linked cash flows. These pressures, coupled with grid and planning constraints, have particularly affected large new-build and merchant-exposed assets. Heightened policy uncertainty has also increased valuation risk and delayed final investment decisions.

Businesses are more selective and risk‑aware, with sharper focus on regulatory alignment and supply‑chain due diligence. Projects are expected to monitor and report environmental impacts across life cycle carbon, biodiversity, and sourcing; those without credible ESG performance face tougher financing and stakeholder scrutiny.

Energy security and system resilience have moved to the foreground alongside decarbonisation. With grid capacity constraints and global supply chain fragmentation, businesses are diversifying into distributed energy, behind‑the‑meter solutions, and enabling technologies that enhance flexibility and reliability. Interest has grown in battery storage, smart grid and forecasting technologies, and long‑duration storage, reflecting the need to integrate higher shares of variable renewables while mitigating system shocks. The result is a more disciplined, phased approach to capital deployment, with heightened scrutiny of project economics, supply chain integrity, and long‑term resilience.

The investor mix remains diverse. Dedicated infrastructure funds continue to anchor major transactions, sometimes in club deals with pension funds and sovereign wealth funds. Strategic investors such as utilities, energy majors and corporates, are pursuing acquisitions and joint ventures to secure power and flexibility as part of decarbonisation and electrification strategies. Private equity and private credit are increasingly active in growth-capital and refinancing transactions, filling gaps left by tighter bank lending.

Investor strategies have evolved from passive asset ownership to active platform building and policy‑aligned partnerships. Private equity infrastructure funds are increasingly acquiring or creating scalable platforms and growing them through bolt‑ons. Institutional investors, including pension funds and sovereign wealth funds, continue to target long‑duration, de‑risked assets with contracted or inflation‑linked revenues, often via co‑investments or joint ventures. Many investors are also moving earlier in the project life cycle, funding late‑development or pre‑construction stages in exchange for enhanced returns, often in collaboration with specialist developers. Secondary sales of operational assets remain a key tool for capital recycling, freeing up equity for new development.

In the energy sector, the Crown Estate’s Floating Offshore Wind Leasing Round 5 began in December 2023, with the invitation-to-tender stage starting in August 2024 and preferred bidder status for two of the Round 5 project sites being announced in June 2025.

In July 2025, the UK government announced the final go-ahead on the GBP38 billion Sizewell C nuclear plant project. The government is the largest shareholder in the project, which has suffered extensive cost overruns and delays. The French energy major EDF is currently building the Hinkley Point C nuclear power plant in Somerset, which has also been plagued by delays and increased construction costs.

On the infrastructure side, the Heathrow Airport expansion – including a new terminal, a third runway and enhancement of rail, road, cycle and pedestrian access to the airport – was revealed in August 2025 with a cost of around GBP49 billion. The plans for a third runway at the airport are backed by the UK government but face significant environmental, political and local opposition.

Other ambitious infrastructure projects include the Lower Thames Crossing, the TransPennine Route Upgrade, the A9 Dualling Project and Statera Energy’s 680 MW battery-energy storage facility in the Trafford Low Carbon Energy Park.

Establishing a New Company

New UK start-up companies in the sector are typically incorporated domestically. One of the advantages of doing so is that entrepreneurs can benefit from the jurisdiction’s favourable legal framework, particularly for renewable energy initiatives, such as the contracts for difference scheme and Innovate UK grants and funding. In certain instances, there may be specific reasons to choose another jurisdiction, such as tax, regulatory or operational advantages.

The process for incorporating a new company in the UK can take as little as a few hours, and there is no minimum capital requirement for incorporation (except in the case of a public limited company). Founders should also consider sector-specific licences and planning consents at an early stage.

Types of Entities

Entrepreneurs in the UK energy and infrastructure sector are typically advised to choose a private limited company (Ltd) as the initial entity for their enterprise, as it offers limited liability to shareholders, flexibility in terms of governance and financing, and potential tax efficiency.

Depending on the nature and scale of the business, other types of entities may be preferable, such as a public limited company (PLC), which may be suitable if there are plans for a future public offering, or a limited liability partnership (LLP), which can be considered for joint ventures or investment-focused structures.

Early-Stage Financing

Early-stage financing (seed investment) for start-ups is typically provided by a mix of sources, including:

• local investors, such as angel investors, family offices and high net worth individuals;
• government-sponsored funds, such as the British Business Bank, the UK Innovation and Science Seed Fund, and the Enterprise Investment Scheme; and
• foreign investors, such as venture capital (VC) firms, and corporate venture arms and strategic partners.

Early-stage financing is usually documented through a term sheet, which sets out the key terms and conditions of the investment, such as the valuation, amount, structure, rights and obligations of the parties. The term sheet is typically followed by more detailed and formal documents, such as a subscription agreement, a shareholders’ agreement and articles of association.

VC is a significant source of financing for start-ups in the UK energy and infrastructure sector, with a range of domestic and foreign investors including:

• home-country VC firms, such as Octopus Ventures, Draper Esprit and Scottish Equity Partners, which may focus on specific stages, sectors or regions of the market;
• government-sponsored funds, such as the Future Fund, British Patient Capital and the Industrial Strategy Challenge Fund, which co-invest with private investors to support the growth and development of the sector, and to address market gaps and challenges; and
• foreign VC firms, such as Sequoia, Accel and SoftBank, which have increased their activity and presence in the UK market, and which may offer larger amounts of capital, global reach and strategic partnerships.

Prevalence in the UK

Early-stage ventures in energy and infrastructure are common in the UK, with activity supported by an active investor ecosystem, government programmes and a deep pool of technical talent. However, capital intensity and regulatory complexity require many ventures to progress via partnerships or consortiums, as well as staged financing aligned to development milestones.

While the most appropriate approach will depend on the specific circumstances of the company and the timing of the process, a sale process is generally the most common liquidity route. It may be run as an auction or bilateral negotiation, depending on market conditions, performance and investor preferences. While auctions are generally preferred to maximise value and manage single‑buyer risk, bilateral sales can deliver greater speed and certainty and may suit situations with a strong strategic buyer. Sellers (including founders) typically stand behind representations, warranties and certain deal-specific liabilities (eg, tax, employment and environmental liabilities). Caps are often the purchase price for fundamental warranties and 10–30% for business warranties, subject to negotiation. Warranty and indemnity (W&I) insurance is becoming the norm in sponsor-led deals to facilitate clean exits, while smaller VC or early-stage deals still rely on traditional escrow or holdbacks (typically 5–15% of the purchase price for 12–24 months) aligned to warranty survival periods.

In contrast, a listing is generally pursued where it is expected to generate stronger demand or a higher valuation, or where founders or investors wish to retain a material stake. In some cases, company size or competition concerns can also limit buyer universes, making a listing more attractive. Investors may also run a dual‑track process (pursuing both a sale and a listing) to create price tension if both tracks are credible.

The London Stock Exchange is the natural venue for UK listings, including many energy and infrastructure companies. Some issuers may consider a foreign exchange (eg, the US) if expected valuation, investor base or strategic factors support it. Key considerations include relative valuations, capital‑raising costs, ongoing compliance burdens, peer locations and litigation risk. Following several years of reduced IPO activity, the UK overhauled its listing regime in 2024 to encourage more listings and growth on UK markets, with more flexible eligibility and continuing obligations that are disclosure focused (rather than shareholder-approval focused).

Spin-offs are not very common in the UK energy and infrastructure sector, as they may involve significant costs, complexity and risks. However, in recent years there have been a few spin-offs in the sector, including:

• SSE’s spin-off of its retail business, SSE Energy Services, and subsequent sale to OVO Energy, a challenger energy supplier, in 2020 as part of its strategy to focus on its core businesses of renewable energy generation and networks, and to address the regulatory and competitive challenges in the retail market; and
• National Grid’s spin-off of its gas distribution business (National Grid Gas Distribution) and subsequent sale to a consortium of infrastructure investors in 2017, as part of its strategy to rebalance its portfolio and create value for its shareholders, and to comply with regulatory requirements for the separation of its gas and electricity businesses.

Some of the reasons to consider a spin-off include:

•       strategic realignment;

• regulatory compliance;
• unlocking shareholder value;
• capital raising and financing;
• facilitating future M&A opportunities;
• tax and financial considerations; and
• managing risk profiles.

Spin-offs are generally structured in a way that benefits either from general tax reliefs (eg, participation and dividend exemptions) or from specific UK tax reliefs for company reconstructions and reorganisations. A combination of these reliefs generally means that there is no UK tax payable either at the corporate or shareholder level. The specific requirements will depend on whether the spin-off is in the form of a direct distribution or a three-cornered demerger, and whether the shareholders are individuals or corporations.

A spin-off followed by a business combination is possible in the UK, but it may involve additional tax, legal and regulatory implications and challenges, depending on the timing, structure and purpose of the transaction.

Some of the key requirements and considerations for a spin-off followed by a business combination include:

• being carried out for bona fide commercial reasons, and not for the purpose of tax avoidance or evasion, or for the benefit of connected persons;
• obtaining the necessary board and shareholder approvals, as well as consent from regulators and creditors; and
• complying with the relevant antitrust rules and seeking clearance from the relevant authorities (such as the Competition and Markets Authority (CMA), the Financial Conduct Authority (FCA) and/or the Takeover Panel).

Depending on the structure of the spin-off and the amounts at stake, the parties may wish to obtain both or either:

• a view from HM Revenue & Customs (HMRC) that the spin-off meets the technical requirements to benefit from the relevant tax reliefs (a non-statutory clearance); and/or
• a statutory clearance that certain anti-avoidance rules will not apply (HMRC has 30 days to respond to the relevant statutory clearances).

There is no time limit for HMRC to respond to a non-statutory clearance, but they usually respond within 28 days.

While there may be some potential benefits to stakebuilding in a UK public (ie, exchange-listed) company prior to making an offer (eg, because any purchases will likely be at below the offer price and count towards achieving the acceptance condition and may discourage interlopers), it will be necessary for a bidder to consider the following issues (among others) before doing so (and as a result of such considerations, bidders often decide that it is not advantageous to stakebuild in the particular circumstances).

• Disclosure implications: Disclosure of voting rights in a UK company of 3% or more (and any crossing of a percentage threshold thereafter) is required (in accordance with the Disclosure Guidance and Transparency Rules). Once an offer period commences, an opening position disclosure is required by the bidder and its concert parties, and by any person interested in 1% or more of any relevant securities of a party to the offer (other than relevant securities of a cash bidder), plus disclosure of any dealings in any such relevant securities.

• Voting threshold implications: Any shares held by the bidder cannot be voted in favour of a scheme of arrangement (“scheme”) and may make it easier for a dissenting minority to block the scheme (see 4.3 Transaction Structures).

• Squeeze-out implications: Shares held by the bidder before the offer document is published will not count towards the 90% squeeze-out level (see 4.8 Squeeze-Out Mechanisms) and may make it harder to reach the 90% threshold.
• Insider dealing: It will be necessary to consider whether any stakebuilding would constitute insider dealing or market abuse (if the bidder has inside information in relation to the target other than the bidder’s own intention to make an offer).
• Setting the floor price/form of consideration: The acquisition of public company shares will set a floor price for a bid announced within three months of the relevant acquisition, or if the acquisition is made after commencement of the offer period. In addition, if a stake of more than 10% is acquired for cash in the prior 12 months or during the offer period for cash, any offer must be in cash or include a cash alternative at the highest price paid.
• Mandatory offer: A mandatory offer is required if a bidder (and its concert parties) becomes interested in shares carrying 30% or more of the voting rights of the target (see 4.2 Mandatory Offer).

Under the Takeover Code, there is a mandatory requirement to launch an offer if a bidder (and its concert parties) is interested in shares carrying 30% or more of the voting rights of a company subject to the Takeover Code.

A mandatory offer must be in cash (or include a cash alternative) at no less than the highest price paid by the bidder (and its concert parties) during the prior 12 months.

The typical transaction structures for an acquisition of a public company in the UK are:

• a contractual takeover offer; or
• a court-approved scheme of arrangement.

The acquisition may be recommended or hostile, with most being recommended by the public company’s board of directors.

On a contractual takeover offer, most bidders will set an acceptance level of 90% in order to facilitate a squeeze-out, but bidders can set an acceptance level as low as 50% plus one.

A scheme must be approved by the court and by the public company’s shareholders by a majority in number, who also represent at least 75% in value (ie, it is a dual test), of those voting. Once approved, a scheme binds all shareholders, so that there is no need to squeeze out minority shareholders (see 4.8 Squeeze-Out Mechanisms). Schemes of arrangement are the customary method of implementing recommended transactions.

Public company acquisitions of UK companies can be structured as cash or securities exchange transactions. Bidders may also offer cash and/or securities in a “mix and match offer”. If securities are offered as part of the consideration for the acquisition then a prospectus may be required (see 8.2 Prospectus Requirements).

See 4.1 Stakebuilding (“Setting the floor price”) for the circumstances in which a minimum price or cash consideration requirement will apply.

Contingent value rights, which provide target shareholders with the right to an additional cash payment on the occurrence of a specific event (eg, the successful outcome of material litigation or a subsequent disposal for more than a specified hurdle price), are a feature of a small number of transactions and can assist in bridging value gaps between the parties where the valuation will be significantly impacted by the outcome of specific events.

An offer will customarily be subject to conditions in respect of:

• acceptance levels in the case of a contractual takeover offer (see 4.7 Minimum Acceptance Conditions) or the scheme becoming effective in the case of a scheme;
• applicable legal or regulatory requirements or approvals;
• long-stop dates; and
• general protective conditions in respect of the continuing nature and condition of the target.

An offer cannot be subject to conditions or pre-conditions (being conditions to the offer formally being made) that depend solely on subjective judgements by the bidder or the target, or the fulfilment of which is in their control. See 4.9 Requirement to Have Certain Funds/Financing to Launch a Takeover Offer and 4.14 Timing of the Takeover Offer in relation to finance conditions and regulatory pre-conditions, respectively.

Before a bidder can invoke a regulatory condition or a general protective condition (such as a material adverse change condition), the Takeover Panel must be satisfied that the relevant circumstances upon which the bidder is seeking to rely are of material significance to it in the context of the offer. This is an extremely high bar in practice.

On a public takeover that is recommended by the board of the target and implemented by way of a scheme or arrangement, it is customary for the bidder and the target to enter into a transaction agreement (often called a “co-operation agreement”) dealing with issues such as co-operating in relation to implementing the scheme and obtaining regulatory clearances. However, the Takeover Code generally prohibits the target (without shareholder approval) from entering into any “offer-related arrangement” with the bidder (see 4.10 Types of Deal Protection Measures for further details). The target will not be permitted to agree to any interim operating covenants, and it is not customary for the target to provide warranties in connection with the offer.

On a contractual takeover offer, most bidders will set an acceptance level of 90% in order to facilitate a squeeze-out (see 4.8 Squeeze-Out Mechanisms) but bidders can set an acceptance level as low as 50% plus one. That said, an acceptance level of at least 75% is required in order to be able to delist the target and to pass special resolutions, and any financing banks will generally require at least a 75% acceptance level.

In contrast, a scheme must be approved by the court, and by the public company’s shareholders by a majority in number, who also represent at least 75% in value (ie, it is a dual test), of those voting.

On a contractual takeover offer, the bidder will have a statutory right under the Companies Act 2006 to compulsorily acquire (or “squeeze out”) shares held by the minority. To take advantage of this right, the bidder needs to have acquired in the offer or unconditionally contracted to acquire:

• 90% in value of the shares to which the offer relates; and
• 90% of the voting rights carried by the shares to which the offer relates.

However, it will not be necessary to exercise squeeze-out rights in the case of a scheme of arrangement, as the bidder will acquire 100% of the shares once the scheme takes effect (see 4.3 Transaction Structures and 4.7 Minimum Acceptance Conditions for the shareholder approval thresholds on a scheme).

The offer timetable under the Takeover Code commences when a bidder announces a firm intention to make an offer (see 8.1 Making a Bid Public). A bidder is required to have “certain funds”, being sufficient resources available to satisfy full acceptance of the offer, at the time of its firm intention announcement. The bidder’s financial adviser will be required to provide a formal “cash confirmation” that the certain funds requirement under the Takeover Code has been satisfied.

Therefore, if a bidder is funding a portion of the consideration from debt facilities, it will be necessary to have a certain funds facility in place at the time of its firm intention announcement.

Although financing pre-conditions may be permitted with Takeover Panel consent, financing conditions to the offer are not permitted.

The Takeover Code generally prohibits the target (without shareholder approval) from taking any action that may frustrate an offer and from entering into any offer-related arrangement (including deal protection measures) with the bidder. However, “offer-related arrangements” do not include confidentiality agreements, non-solicit agreements, commitments to provide information or assistance to obtain regulatory approvals, irrevocable commitments or letters of intent from shareholders (see 4.12 Irrevocable Commitments), agreements relating to existing employee incentive arrangements and agreements in relation to the future funding of the target’s pension scheme.

While reverse break fees are permitted, target break fees are not permitted except in very limited circumstances, and where the fee is 1% or less of the offer price. Target poison pills are also generally not permitted, and UK public companies generally do not incorporate poison pill-type defences in their governance documents.

If a bidder cannot obtain 100% ownership of a target as a result of a contractual takeover offer (it being noted that a bidder will obtain 100% ownership of a target if an offer is successfully implemented pursuant to a scheme), the governance rights it obtains in respect of a UK company will be largely dependent on whether it holds more than 50% or at least 75% of the target’s voting rights.

With more than 50%, the bidder will be able to, for example, remove and appoint directors and auditors. With 75% or more, the bidder will be able to, for example, delist the target, amend its articles of association, disapply pre-emption rights and re-register as a private company.

Bidders will customarily seek irrevocable commitments or non-binding letters of intent from the directors and principal shareholders of the target to support the transaction.

Bidders will often seek “hard” irrevocable commitments from director shareholders to vote in favour of the scheme or to accept the contractual takeover offer. Depending on the circumstances, principal shareholders may only be willing to provide “soft” irrevocable commitments providing for an “out” if a better offer is made, “semi-hard” irrevocable commitments providing for an “out” if a better offer above a specified threshold is made, or merely a non-binding letter of intent.

The offer or scheme document does not require Takeover Panel approval, but a copy along with specific checklists must be shared with the Panel. Consultation with or consent from the Takeover Panel may be necessary for certain Takeover Code matters.

In a scheme of arrangement the scheme document does, however, have to be filed with the court, normally at least a week before the court hearing to convene the scheme meeting of shareholders. Following the hearing, the scheme document and the notice of meeting are sent to target shareholders.

For a securities exchange offer, the FCA must approve the prospectus or exemption document if required (see 8.2 Prospectus Requirements), a process typically taking six to eight weeks.

The Takeover Code sets detailed timelines for contractual takeover offers and schemes of arrangement. If a competing offer arises, the timetable for both offers generally starts from the new competing bidder’s offer document publication date. A bidder may issue an “acceleration statement” to expedite the offer conditions’ satisfaction or waiver date.

For competing offers under a scheme, consultation with the Takeover Panel on the applicable timetable is required.

On a contractual takeover offer, all conditions must be satisfied or waived, or the offer must lapse, by the 60th day following the publication of the offer document. However, the Takeover Panel can agree to a suspension of the offer timetable from the 37th day at the joint request of the bidder and the target or, if one or more of the outstanding conditions relates to an official authorisation or regulatory clearance that the Takeover Panel considers to be “material”, at the request of the bidder or the target.

On a scheme of arrangement, the court hearing to approve the scheme will only take place once the shareholders have voted to approve the scheme and all regulatory and other conditions have been satisfied or waived.

For both contractual takeover offers and schemes of arrangement, the bidder must provide for a “long-stop date” by which the acceptance condition, together with all conditions relating to an official authorisation or regulatory clearance will need to be satisfied. The long-stop date can be extended by the bidder with the consent of the Panel and/or the target.

Except with Takeover Panel consent, the bidder can only include pre-conditions to the making of its offer if such pre-conditions involve an official authorisation or regulatory clearance relating to the offer, and either the target agrees or the authorisation or clearance is considered to be material.

It is possible for a privately held company which is not subject to the Takeover Code to be acquired by means of a non-Code regulated offer to shareholders. This would only be considered if there are an unusually large number of shareholders and the company’s constitutional documents do not include any mechanism for the majority of shareholders in favour of a sale to “drag-along” any dissenting minority shareholders. In the vast majority of cases, any acquisition will be by means of an acquisition agreement entered into between the buyer(s) and the selling shareholder(s) for the purchase of the shares in the company (commonly referred to as a share purchase agreement or “SPA”). Even if it is the buyer who makes the first approach, it is the shareholders who are deciding to sell and who can therefore decide whether to run any sale as an auction or as a bilateral negotiation with a chosen buyer (see 2.2 Liquidity Events for key considerations in terms of transaction structure, form of consideration and certain transaction terms).

Setting Up and Operating New Energy and Infrastructure Companies

Generally speaking, the energy and infrastructure sectors in the UK are heavily regulated. New companies in the energy and infrastructure industry must comply with various regulations that are overseen by regulatory bodies on a sector-by-sector basis, and the regulatory landscape is evolving in order to encourage achievement of the government’s energy-transition objectives, with increasing regulation for example in relation to the electric vehicle (EV) charging infrastructure. The timeframes in which permits or approvals are granted vary and, in many instances, formal timeframes are not publicly available. However, recent examples of licensing rounds provide useful insight where formal timelines are not published by regulators.

Utility Companies

Utility-scale projects in England over 50 MW (or 100 MW for offshore wind) are regulated under the Planning Act 2008, while smaller projects fall under the Electricity Act 1989, both overseen by the Secretary of State for Energy Security and Net Zero. Ofgem, delegated by the Gas and Electricity Markets Authority (GEMA), regulates market functions and licensing, with processing times for electricity generation licences averaging 65 working days.

Offshore Wind

Offshore wind requires a Development Consent Order from the Secretary of State, with seabed rights awarded by the Crown Estate Commissioners following auctions. As an example timeline, the Crown Estate’s Floating Offshore Wind Leasing Round 5 began in December 2023, with the invitation-to-tender stage starting in August 2024 and preferred bidder status for two of the Round 5 project sites being announced in June 2025.

EV Charging Infrastructure

The UK regulatory landscape has evolved in recent years to reflect the growing importance of the EV charging sector. Regulations such as the new Part S of the Building Regulations 2010, the Alternative Fuels Infrastructure Regulations 2017, the Electric Vehicles (Smart Charge Points) Regulations 2021, and the Public Charge Point Regulations 2023 aim at regulating charge point operators (CPOs) and ensuring safety, harmonisation, consumer protection and convenience in the EV charging sector.

The UK Takeover Panel is the primary regulator in relation to public M&A transactions in the UK. The Takeover Panel issues and administers the Takeover Code and supervises and regulates takeover bids and merger transactions in relation to companies that have their registered offices in the UK, the Channel Islands or the Isle of Man if any of their securities:

• are admitted to trading on a UK-regulated market, a UK multilateral trading facility or any stock exchange in the Channel Islands or the Isle of Man (a “relevant market”); or
• have been admitted to trading on a relevant market in the previous two years.

Until changes made in February 2025, the Takeover Code used to apply to a broader range of entities including unlisted public companies, and in limited circumstances private companies (eg, where shares have been publicly traded on certain markets or matched bargain facilities during the prior ten years), that have their registered offices in the UK, the Channel Islands or the Isle of Man and which are considered by the Takeover Panel to have their place of central management and control in the UK, the Channel Islands or the Isle of Man. Transitional provisions apply under which a company which was subject to the Takeover Code in February 2025 but does not come within the reduced scope of the Code (a “transition company”) will remain subject to the Takeover Code until February 2027.

Foreign direct investment in the UK is principally governed by the National Security and Investment Act 2021 (NSIA), which allows the UK government to review investments in sectors related to national security. The regime includes a pre-closing, mandatory clearance process for investments reaching more than 25%, more than 50%, or 75%+ of voting rights in companies engaged in 17 specified sensitive sectors, such as robotics, artificial intelligence, space technologies, synthetic biology, export-controlled materials, energy, communications and defence. Failure to submit a mandatory notification when required can result in the transaction being void, with potential financial and other (including criminal) penalties.

Voluntary notifications are also possible, enabling government review based on the target’s activities and investment type, and the acquirer’s profile. If deemed a security risk, the government may block, unwind or amend transactions. The NSIA’s broad scope includes minority stakes that grant “material influence”, foreign-based targets with UK connections and internal reorganisations, with some exclusions under consideration.

National Security Review

The NSIA governs the national security review of UK investments, covering any acquirer, domestic or foreign. Some investments require mandatory pre-closing notification and clearance, while the government can broadly investigate investments on national security grounds. Factors for review include:

• the target’s activities, including those adjacent to the 17 sensitive sectors under the NSIA;
• specific investment aspects, such as the access or information rights acquired; and
• the acquirer’s nature, including jurisdiction, foreign government ties and potential hostility towards UK interests.

Export Control

Most aspects of the UK’s export controls regime derive from multilateral agreements (eg, the Wassenaar Arrangement). Controlled items evolve with technological advancements and include military and dual-use items, non-military firearms, items that can be used for capital punishment and items with a radioactive source.

Licensing is required for exporting controlled items, overseen by the Export Control Joint Unit, with enforcement managed by HMRC, Border Force and the Crown Prosecution Service. Violations are criminal offences but may be resolved through civil settlements.

Export restrictions also cover brokering and technical assistance and may intersect with sanctions regimes, necessitating dual compliance for some licences. Trade sanctions are implemented and enforced by the Office of Trade Sanctions Implementation.

UK merger control operates under a voluntary filing system, meaning that parties are not required to notify the CMA or obtain clearance pre-closing. However, the CMA can investigate transactions (including post-closing), issue “hold separate orders” and, if competition issues arise, require transaction unwinding. To mitigate risk, parties may choose to engage with the CMA voluntarily.

CMA jurisdiction applies if certain thresholds are met, such as a UK turnover of GBP100 million for the target, a combined share of supply exceeding 25%, or transactions involving parties with a 33% UK share of supply and GBP350 million in turnover.

For regulated entities under the Gas Act 1986 or Electricity Act 1989, the CMA holds additional review powers, as well as in relation to the water and sewerage sectors.

The Labour government proposed a raft of new employment laws in its Employment Rights Bill which seek to bolster protections for employees in a range of ways, as well as strengthening the position of trade unions where they exist. Many of these new laws are expected to come into effect by 2027. Acquirers will therefore need to continue to ensure thorough due diligence in order to identify high-value or high-liability employment rights as well as ensuring compliance with information and consultation rights, which can impact a transaction timetable. While it is possible for trade unions and works councils to exist within private UK businesses, they tend to be rare and any opinion or advice from such bodies is not typically binding on the business. Pre-completion information consultation requirements are more likely to triggered where the transaction is one to which the Transfer of Undertakings (Protection of Employees) Regulations 2006 (“TUPE”) apply.

TUPE most frequently applies to transactions which involve the transfer of a business as a going concern, such as in an asset sale or carve-out scenario. The effect of TUPE is that the employment contracts of the employees in the business being sold are automatically transferred by operation of law to the acquirer of that business, protecting their terms and conditions of employment. The acquirer effectively steps into the shoes of the previous employer as if it had always been the employer of the transferring employees, taking on all related rights and obligations. The transferring employees also benefit from enhanced protection against dismissal and changes to their terms and conditions post-transfer. Acquirers should be aware of the limitations TUPE can place on post-completion workforce adjustments including attempts to harmonise the new workforce with their own. Importantly, TUPE requires a prior information and consultation process with the affected employees or their representatives to have been carried out in advance of the transfer, potentially impacting the transaction timetable, with penalties for those who fail to comply.

The UK does not have any currency control regulations and does not require any central bank approval for M&A transactions. The UK has a free and open market for foreign exchange, and parties are free to convert and transfer any currency in and out of the UK, subject to compliance with any applicable sanctions or anti-money laundering regulations.

The most recent energy and infrastructure M&A court decision was the English Supreme Court ruling in R (on the application of Finch on behalf of the Weald Action Group) v Surrey County Council and others (2024) UKSC 20, often referred to as Finch.

The court, by a three-to-two majority, held that downstream greenhouse gas (GHG) emissions from using oil produced by an expanded Surrey project, fall within the scope of the environmental impact assessment (EIA) required under the EIA Directive and related regulations. The decision quashed Surrey County Council’s approval, emphasising that the EIA “must include all effects of the project, whether direct or indirect, immediate or remote”.

This was the first time that an apex court has addressed the interpretation of the EIA Directive in the context of the extraction of hydrocarbons.

Moreover, for UK projects, EIAs must now account for downstream Scope 3 emissions for new or expanded hydrocarbon projects involving combustion. However, the EIA Directive’s applicability to non-hydrocarbon projects remains uncertain, as highlighted by Lord Leggatt’s distinction of other commodities with less predictable environmental impacts. This will be a space to watch.

The practical effect of Finch does not mandate denial of planning permission for projects with Scope 3 emissions; decision-makers may still grant approval.

Clean Power 2030 Action Plan

The share of electricity generation from renewable sources represents an ever-increasing proportion of all generation. The UK Government’s Clean Power 2030 Action Plan of December 2024 highlights the current administration’s ambition to seek a clean energy production landscape by 2030, with an ambition for 95% of the UK’s total electricity to be from clean sources by 2030. This is underpinned by onshore and offshore wind, solar and nuclear energy, and carbon capture and storage. Its successful implementation will require significant government and private sector investment. Post-Brexit, the UK established its own Emissions Trading System and is drafting its own Carbon Border Adjustment Mechanism, tabled for early 2027.

CCUS

The current government is also focused on carbon capture use and storage (CCUS) as part of its net zero ambitions and wishes to improve the UK’s energy security in light of the increasingly uncertain geopolitical landscape. The Clean Energy Industries Sector Plan is one example of the political ambition to make the UK a global leader in clean energy industries by 2035, doubling investment levels to over GBP30 billion per year and creating jobs across the country. The plan reiterates government support for CCUS supply chain development.

In June 2025 Ofgem, the government regulator for the electricity and downstream natural gas markets in the UK, issued regulatory instructions and guidance (RIGs) on carbon dioxide transport and storage, with a view to further regulating CCUS and getting information from carbon dioxide transport and storage licensees on how they are meeting their licence conditions.

BESS

The UK has also been one of the most active European countries in installing battery electricity storage systems (BESS). BESS is crucial to making renewable energy sources such as wind and solar part of baseload energy generation, by allowing storage of excess power when demand is low and release of that energy when demand is high.

The scope of due diligence in relation to a public company acquisition is typically less extensive than for a private company acquisition, and is generally described as being “confirmatory” in nature – ie, confirming what the bidder understands to be the case based on the target’s public disclosures. Under the Takeover Code, if the target provides information to one bidder, it will be required to make the same information available to all other bona fide potential bidders or actual bidders on request. Given this, a target may want to restrict the extent to which due diligence access is granted to a favoured bidder, in case a less-favoured bidder emerges.

The parties will want to consider whether any information to be provided may constitute inside information for the purposes of the Market Abuse Regulation and, if so, ensure appropriate controls are in place. Where it is envisaged that competitively sensitive information may be shared, a clean team agreement will be required to establish effective procedures and information barriers.

Where the consideration for a bid involves bidder securities, it is customary for the target to conduct reverse due diligence on the bidder.

Data Privacy

Data protection laws in the UK, governed by the UK General Data Protection Regulation (GDPR) and the Data Protection Act 2018, impose limitations on handling, sharing and other forms of processing of personal data during a due diligence exercise. For energy and infrastructure companies, these restrictions are particularly relevant in the context of customer data (which may include customer identifiers, billing information or other personal information) and employee data (which may include records such as payroll information, health data or employment contracts), the processing of which must comply with data protection principles.

The Takeover Panel must be consulted if there is rumour and speculation or untoward movement in the target’s share price, or when negotiations are to be extended beyond a limited group. Subject to certain exceptions, the Panel will require an announcement to be made which identifies any potential bidder. Any announcement made naming the potential bidder, whether made at the direction of the Panel or voluntarily by the bidder or target, will trigger a 28-day “put up or shut up” deadline for the bidder to make an announcement of a firm intention to make an offer or to walk away (though an extension may be sought from the Takeover Panel if the target agrees).

An announcement will also be required under the Takeover Code immediately after a firm intention to make an offer has been communicated to the target’s board, or where an acquisition of target shares triggers an obligation to make a mandatory offer (see 4.2 Mandatory Offer).

A firm intention announcement will commit the bidder to proceed with the offer and to post an offer or scheme document (as applicable depending on the transaction structure – see 4.3 Transaction Structures) within 28 days unless, with the consent of the Takeover Panel, a bidder is permitted to invoke a pre-condition or would be permitted to invoke a condition if the offer were actually to be made.

Separate from Takeover Code requirements, if the bidder or target has listed securities, they may have additional disclosure obligations pursuant to the UK Listing Rules or the Market Abuse Regulations, depending on the size of the transaction, whether the transaction constitutes inside information and whether any other specific disclosure obligations apply as a result of the relevant listing.

Currently on a stock-for-stock takeover offer (or a takeover offer with a mix-and-match facility), the offer of securities to target shareholders will ordinarily constitute an offer of transferable securities to the public requiring an approved prospectus. However, exemptions are available, including on takeovers where the bidder makes an “exemption document” available that has been approved by the FCA.

Where an offer is to be implemented pursuant to a scheme, it is generally accepted that there is no offer of transferable securities to the public such that the scheme itself does not trigger a requirement for a prospectus. For a mix-and-match offer, the position is less clear as there is conflicting FCA commentary on the point.

However, significant prospectus regime reforms are set to come into effect from 19 January 2026. Following these changes, the type of additional prospectus disclosure document required will depend on whether the securities being offered as consideration (the “consideration securities”) will be admitted to trading on a regulated market in the UK as opposed to whether or not there is an “offer to the public”.

If the consideration securities will be admitted to trading on a regulated market in the UK, then a prospectus or an exemption document will be required. If, (i) the consideration securities are of the same class as equity securities in the bidder which are already admitted to trading on a regulated market in the UK; and (ii) the transaction is not a reverse acquisition transaction, then it is expected that the offer document or scheme circular will be able to constitute a relevant exemption document without the need to be separately reviewed and approved by the FCA. If either of these is not the case, then it is expected that a prospectus or an FCA-approved exemption document will be required.

If the consideration securities will not be admitted to trading on a regulated market or primary multilateral trading facility in the UK, then it will be possible to offer the consideration securities to target shareholders, provided the offer is accompanied by a “written statement” setting out certain specified information. It remains to be seen how regulatory and market practice will develop in relation to this requirement.

Under the Takeover Code, where a bidder is UK incorporated and its shares are admitted to trading on a UK-regulated market, Alternative Investment Market (AIM) or the Aquis Stock Exchange (AQSE) Growth Market, the offer or scheme document must contain details of:

• the website with –
1. its audited consolidated accounts for the last two financial years; and
2. any preliminary statement of its annual results, half-yearly financial report or interim financial information, published since the date of its last audited accounts; and
• in a securities exchange offer, any known significant change in its financial or trading position since the end of the last financial period for which the accounts/reports/interims referenced in the foregoing have been published (or an appropriate negative statement).

For other bidders, the offer or scheme document must contain this information, so far as is appropriate, and such further information as the Takeover Panel may require.

Where a prospectus or exemption document is required on a securities exchange offer, there may also be additional requirements in respect of the financial information to be disclosed.

A copy of the offer or scheme document will need to be shared with the Takeover Panel (along with accompanying checklists). In addition, in the case of a securities exchange offer, it will be necessary for the FCA to approve the prospectus or exemption document if such document is required (see 8.2 Prospectus Requirements).

The Takeover Code also requires various documents to be published on a website in connection with a public takeover including, among other things, any announcement of a possible offer or firm intention to make an offer, any offer or scheme document, irrevocable commitments or letters of intent (see 4.12 Irrevocable Commitments), any permitted offer-related arrangements such as co-operation agreements (see 4.6 Deal Documentation and 4.10 Types of Deal Protection Measures) and any financing documentation.

The statutory general duties of directors in the UK are to:

• act within their powers;
• promote the success of the company;
• exercise independent judgement;
• exercise reasonable care, skill and diligence;
• avoid conflicts of interest;
• not accept benefits from third parties; and
• declare an interest in a proposed transaction or arrangement.

The duty to promote the success of the company is to act in a way a director considers, in good faith, would be most likely to promote the success of the company for the benefit of the shareholders as a whole, and in doing so have regard to, among other matters, the likely consequences of any decision in the long term, the interests of the company’s employees, the need to foster business relationships, the impact of the company’s operations on the community and the environment, the desirability of maintaining a reputation for high standards of business conduct, and the need to act fairly regarding shareholders.

In general, directors’ duties are owed to the company and not to the shareholders.

It is common in the UK for boards of directors to establish a committee with delegated authority in relation to a transaction, particularly once it has been approved in principle by the board.

Such committees may also be relevant when certain directors have a conflict of interest, for example, in the case of a management buy-out.

In relation to a transaction to which the Takeover Code applies, directors must ensure compliance with the Code. While the Takeover Code permits a board to delegate the day-to-day conduct of an offer to particular directors or a committee of the board, the board must monitor the conduct of the transaction effectively so that each director can fulfil their Code responsibilities.

An M&A transaction will typically be negotiated on a day-to-day basis by key executives, under close oversight of the board and with the support of external advisers.

Where the Takeover Code applies, the directors of the bidder and the target must ensure compliance with the Takeover Code. While the Takeover Code permits a board to delegate the day-to-day conduct of an offer to particular directors or a committee of the board, the board must monitor the conduct of the transaction effectively so that each director can fulfil their Takeover Code responsibilities. Under the Takeover Code, the target board is also required to provide its recommendation to shareholders in relation to the offer.

Shareholder litigation is relatively uncommon in the UK, in part because in general, directors’ duties are owed to the company rather than the shareholders (see 9.1 Principal Directors’ Duties). Where a transaction involves public disclosure, investors may be able to bring a claim to the extent the requisite disclosure standard for the relevant document has not been met.

Directors will typically receive independent advice in a number of areas, which (depending on the particular circumstances and the skill sets available within the company) will commonly include, among other things:

• financial advice (including as to valuation and deal terms);
• legal and regulatory advice (including as to legal due diligence, transaction documentation and regulatory approvals);
• accounting and tax advice; and
• specialised technical advice (including, in the context of energy and infrastructure M&A, from consultants, engineers and environmental experts).

Under the Takeover Code, the board of the target is required to obtain competent independent advice in respect of whether the financial terms of an offer are fair and reasonable, and the substance of that advice must be made known to the shareholders.

Outside of the advice provided by a financial adviser in the context of a Takeover Code transaction, it is less common to seek fairness opinions from financial advisers in the UK than in some other jurisdictions, particularly the USA.