Octopus to spin off tech arm Kraken

(Sharecast News) - Octopus Energy is to spin off Kraken, its fast-growing technology unit, the British gas and electricity provider confirmed on Thursday. Developed initially for use within Octopus, Kraken's AI-powered platform has since been licensed to numerous other utilities.

It is contracted to serve more than 70m household and business accounts worldwide, with $500m in committed annual revenues from clients including EDF, E.ON Next and National Grid US.

Octopus said spinning out the business would accelerate Kraken's global expansion, allowing it to fast-track technology investments and expand into new energy markets.

Greg Jackson, chief executive of Octopus, said Kraken was a now a "huge and successful" business in its own right.

He continued: "I set the embarrassingly low goal of 100m accounts by 2027; it looks like it'll beat that and can now aim to serve 1bn people over the next decade."

Tim Wan, formerly of software firm Asana, has been appointed Kraken's chief financial officer to oversee the spin-off with chief executive Amir Orad.

No specifics have yet been provided, although Octopus's owners are expected to retain a holding.

According the Financial Times, citing unnamed people familiar with the matter, the business could eventually be listed in either New York or London, with a value of around $10bn.

Wan oversaw Asana's market listing when he was chief financial officer at the US company.

Octopus is owned by a number of pension funds and other investors, including Japanese utility Tokyo Gas, Australia's Origin Energy and US fund Generation Investment Management.