Octopus sells $1bn stake in Kraken as revenues rise 10%

Octopus Energy has agreed to sell a stake in its Kraken software arm, in a move that would value the division at $8.65bn (£6.4bn) and could open the way for a stock market flotation.

- Kalyeena Makortoff

The technology, which it already licenses to some rival suppliers, has been vital to the energy company's success, making it easier to manage billing, smart meters, electric vehicle charging and home batteries to make using renewable power cheaper.

Octopus said new investors, including the asset manager Fidelity International and the Ontario Teachers' Pension Plan Board, had joined existing shareholders to acquire a $1bn stake in the business.

The sale, which leaves Octopus with a 13.7% stake in Kraken, comes after it announced in September that it was planning to spin out the division as a standalone company.

The Octopus founder, Greg Jackson, said: "Kraken is in a class of its own, in terms of technology, capability and scale. As an independent company with world-class backers and outstanding leadership, it will be free to grow even faster and is set to be a true UK-founded success story."