The German energy group E.ON has agreed to buy struggling UK rival Ovo in a deal that would create Britain’s biggest gas and electricity supplier.

The combined company will serve about 9.6 million customers, overtaking the market leader, Octopus, which serves almost 8m households in the UK.

E.ON said the deal represented a significant investment in the UK market and would bring bills down for customers.

It said there would be no changes at its domestic energy supplying arm E.ON Next, nor at Ovo, while it awaited regulatory approval for the deal, stressing “existing tariffs will be honoured in full and service will continue unchanged”.…