Octopus Energy has announced the spinoff of its technology division, Kraken, in a move worth $8.65 billion. This strategic decision aims to enhance the operational capabilities of Kraken, which provides innovative services for managing energy consumption.
Overview of Kraken Technology
Kraken leverages artificial intelligence to streamline customer service and billing processes for energy providers. Additionally, it helps users optimize their energy usage by offering incentives for reducing consumption during peak periods.
Client Base Expansion
- Initially created for Octopus Energy, Kraken has expanded its clientele.
- Key clients now include EDF, E.On Next, TalkTalk, and National Grid US.
- It serves approximately 70 million household and business accounts globally.
Investment and Independence
A significant portion of the $1 billion investment will be directed toward Octopus Energy to facilitate its growth. Kraken will receive the remainder of the funds. This investment is crucial for Kraken’s transition to fully independent operations, which is expected within a few months.
Stakeholders
- Octopus Energy retains a 13.7% stake in Kraken.
- Other notable investors include Fidelity International and a branch of the Ontario Teachers’ Pension Plan.
Future Prospects
Amir Orad, the CEO of Kraken, expressed optimism regarding the spinoff. He believes it will provide the necessary “focus and freedom” for Kraken to scale its operations effectively. The company aims to overcome challenges it has faced when engaging with competitors of Octopus Energy.
This spinoff marks a significant step for Kraken, positioning it for higher growth and enhanced service delivery in the energy sector.
