Highlights
- Kraken software arm attracts $1bn investment at $8.65bn valuation from global investors.
- Technology powers customer billing and renewable energy management for suppliers worldwide.
- Octopus Energy founder Greg Jackson indicates medium-term stock market listing possible in London or US.
Octopus Energy has agreed to sell a significant stake in its Kraken software division, valuing the technology arm at $8.65bn (£6.4bn) and paving the way for a potential stock market flotation.
New investors including asset manager Fidelity International and Ontario Teachers' Pension Plan Board have joined existing shareholders to acquire a $1bn stake in the business. The deal leaves Octopus Energy holding a 13.7 per cent stake in Kraken following the transaction.
The software has been instrumental in Octopus's rise to become Britain's largest household energy supplier, overtaking British Gas in January after nearly four decades of dominance.
Kraken technology simplifies customer billing management, smart meter operations, electric vehicle charging and home battery systems, enabling cheaper renewable power usage.
Founder Greg Jackson praised the development, stating Kraken is "in a class of its own, in terms of technology, capability, and scale."
He added that as an independent company with world-class backing and outstanding leadership, it would be "free to grow even faster and is set to be a true UK-founded success story."
The stake sale follows September's announcement that Octopus planned to spin out Kraken as a standalone company. Founded by Jackson in 2015, Octopus emerged from a government initiative to challenge the big six energy companies' market dominance.
Global expansion
Kraken's success extends beyond Octopus, with the platform licensed to rival UK suppliers including E.ON, EDF and Good Energy. International energy companies such as Tokyo Gas in Japan and Origin Energy in Australia also utilise the software.
Speaking on BBC Radio 4's Today programme, Jackson suggested a stock market listing could materialise in the medium term. He expressed hope for a London Stock Exchange flotation while acknowledging competition from US markets.
"For large tech companies like Kraken, it's going to be between London and the US," Jackson told The Guardian, adding that stock exchanges must demonstrate why they're suitable for such global businesses with international investor bases.
