In a landmark deal for the UK's energy and technology sectors, Octopus Energy has agreed to sell a significant stake in its proprietary software platform, Kraken Technologies, valuing the spin-off at a staggering $8.65 billion (£6.4 billion).
A Billion-Dollar Bet on British Tech
The transaction will see new investors, including the global asset manager Fidelity International and the Ontario Teachers’ Pension Plan Board, join existing shareholders to acquire a $1 billion stake in the business. Following the sale, Octopus Energy will retain a 13.7% holding in Kraken, which it first announced plans to spin out as a standalone company in September.
Kraken's intelligent software has been the engine behind Octopus's rapid ascent, which saw it dethrone British Gas as Britain's largest household energy supplier in January. The platform streamlines complex operations like customer billing, smart meter management, and integrating electric vehicle charging and home batteries. This allows suppliers to offer innovative tariffs that leverage real-time electricity price fluctuations, ultimately saving customers money and facilitating the use of renewable power.
Global Ambitions and a Potential London IPO
The technology's success is not confined to Octopus. Kraken is already licensed to several rival UK energy firms, including E.ON, EDF, and Good Energy. Its reach is truly international, with clients such as Tokyo Gas in Japan and Origin Energy in Australia utilising the platform.
Octopus founder and CEO, Greg Jackson, hailed the move, stating: "Kraken is in a class of its own, in terms of technology, capability, and scale. As an independent company with world-class backers and outstanding leadership, it will be free to grow even faster and is set to be a true UK-founded success story."
Jackson also hinted strongly at a future stock market listing for Kraken. In an interview with BBC Radio 4's Today programme, he suggested a flotation could occur in the "medium term" and that the London Stock Exchange is a top contender. "There’s every chance that the Kraken may list at some point... Personally, I really hope it’s London," he said, while noting that US markets also remain an option for the globally-focused business.
The Rise of a Market Disruptor
Founded by Jackson in 2015 amid a government push to break the dominance of the 'big six' energy firms, Octopus has grown exponentially. Its crowning as the UK's largest domestic supplier earlier this year ended British Gas's nearly four-decade reign. The deal underscores the immense value created by homegrown technology in transforming traditional industries and positions Kraken as one of the UK's most valuable private tech enterprises.
