But what to do now?
Continue. The warning is expected, since OpenVZ VPSs do not have their own kernels -- they operate on the physical host's kernel. OpenVZ is more like an enhanced chroot rather than a true virtual machine in that respect.
Important - if your running kernel is less than 2.6.24
Please check your current kernel version with uname -r. If it is less than 2.6.24, the upgrade will fail half-way with a glibc error. That happens because the glibc included by default with 12.04 requires a minimum 2.6.24 kernel -- glibc are the critical C libraries used by every application.
At that point, you will need the instructions [from this answer], as pasted below:
I've set up a PPA containing a recompiled libc which is compiled to work on 2.6.18 or newer (please check uname -r!), and it should override the current libc provided by Precise. Just add ppa:izx/ovz-libc, update, and it should let you get past this. Specifically, something like this:
apt-add-repository ppa:izx/ovz-libc
apt-get update
apt-get -f install
do-release-upgrade
and continue on until the upgrade completes successfully. I highly recommend NOT replacing any changed or non-existent config files.
I will be keeping the ppa updated as and when libc is updated upstream. The PPA package includes a pin so that it will only be updated when the new fixed libc is available on the PPA, not when it first appears in the official repositories.
fdiskfails because OpenVZ has one single "simulated filesystem", no partitions or anything. – ish Jun 05 '12 at 04:31