The valuation was confirmed by Origin Energy Ltd., a key investor in Kraken’s parent company, Octopus Energy Group Ltd. Kraken, which provides artificial intelligence–driven software that helps utilities manage cleaner and more flexible energy systems, is preparing for a formal separation from Octopus Energy by mid-2026.
As part of the transaction, Kraken will raise $1 billion in fresh equity from a mix of new and existing investors. The development boosted investor sentiment, with Origin Energy shares climbing as much as 1% in Sydney trading on Tuesday.
Origin’s Chief Executive Officer, Frank Calabria, said the company has long believed in Kraken’s potential, noting that the platform has been central to Octopus Energy’s rapid rise to become the UK’s largest electricity supplier, now serving more than seven million customers.
New investors joining Kraken include D1 Capital Partners, Fidelity International, Durable Capital Partners and an investment arm of the Ontario Teachers’ Pension Plan Board. Origin also disclosed that a major, unnamed energy retailer with more than 10 million customers will take a stake in Kraken and adopt its software as a client.
Kraken’s technology allows energy providers to manage complex power flows as renewable energy sources and low-carbon technologies such as electric vehicles, home batteries, solar panels and heat pumps become more common. According to Octopus Energy, the Kraken operating system is already contracted to support more than 70 million customer accounts globally through licensing agreements.
The planned demerger is expected to transform Kraken into a fully independent technology company with its own governance and leadership structure. Octopus Energy said the move would allow it to concentrate on scaling its consumer energy, generation and clean technology operations, while Kraken expands as a neutral global platform for utilities.
Kraken CEO Amir Orad said independence would give the company the focus and flexibility needed to grow worldwide, while maintaining Octopus Energy as a key innovation partner and customer.
In Australia, Origin Energy agreed to waive its exclusivity rights to the Kraken platform in exchange for an additional 1.5% equity stake, helping to offset dilution from the capital raising. Following the transaction and the planned separation, Origin will hold a direct 22.7% stake in both Kraken and Octopus Energy.
Industry analysts note that Kraken’s software enables suppliers to offer more competitive pricing and demand-based incentives to customers, helping utilities manage volatility in electricity supply as grids become increasingly reliant on renewable energy sources.