Octopus Energy, Britain’s largest electricity supplier, said on Thursday it would spin off its technology arm Kraken Technologies into a standalone company, marking a significant step in the group’s strategy to focus on core operations while allowing its fast-growing tech division to pursue independent growth.
The company also announced the appointment of Tim Wan as chief financial officer of the newly separated Kraken Technologies.
Wan previously served as finance chief at US-listed software platform Asana from 2017 until 2024, overseeing its stock market listing.
Kraken has become a major player in energy technology, providing software platforms to global energy companies such as EDF, National Grid US, and Tokyo Gas.
The company has now hit $500 million in committed annual revenue through licensing deals, cementing its position as one of the most valuable technology providers in the utility space.
The separation will give Kraken greater freedom to invest and expand independently while addressing potential conflicts of interest that could arise from its ownership by Octopus, a competitor to many of its clients.
“We set out to create Kraken as a global platform to transform utilities and deliver the innovation, service and value that customers deserve,” Greg Jackson, CEO of Octopus Energy said.
“It looks like it’ll beat the 100 million accounts target by 2027 and can now aim to serve a billion people over the next decade.”
Kraken CEO Amir Orad said the independence move was “strategic and inevitable.”
“Kraken is now a globally successful business in its own right, operating independently for some time – completing our journey to full independence is a strategic and inevitable next step,” he added.
Kraken eyes a potential valuation of £10 billion
While Octopus Energy has not disclosed financial details of the spin-off, Sky News reported earlier this year that Kraken could be valued at up to £10 billion ($13.63 billion).
Citing sources, Sky News has said Goldman Sachs has been hired to advise on the demerger.
The deal would reinforce Octopus Energy’s standing as one of the UK’s most valuable private companies.
It would also highlight the success of founder and chief executive Greg Jackson, who has grown Octopus from a start-up into Britain’s leading household energy supplier in less than a decade.
The spin-off is also expected to benefit Australian electricity and gas retailer Origin Energy, which owns about 23% of Octopus.
Kraken’s expanding client base across sectors
Kraken’s reach now extends far beyond energy.
In the UK, its platform is licensed not only to energy rivals such as E.ON and EDF but also to Severn Trent in water and Cuckoo in broadband.
Internationally, it serves Origin Energy in Australia, Japan’s Tokyo Gas, and Italy’s Plenitude, among others, giving it contracted access to more than 70 million customer accounts globally.
The company is on track to meet its 100 million account target by 2027, with analysts suggesting that milestone could be reached much sooner.
Jackson recently admitted that the goal now seemed “embarrassingly unambitious,” as Kraken scales its offering to new markets.
Octopus Energy’s growing market presence
Octopus Energy has 7.5 million customers in Britain, after its 2022 rescue of Bulb and the acquisition of Shell’s home energy business.
In January, it surpassed Centrica-owned British Gas to become the UK’s largest household supplier, with a 24% market share.
The company also serves 2.5 million customers overseas and is using Kraken’s technology as the backbone of its international operations.
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