Australia’s Origin Energy to take $507 million stake in UK energy retailer

Origin Energy has agreed to acquire a 20% stake in UK retailer Octopus Energy for AUS$507 million, with an exclusive licence to use its technology in Australia, both companies announced on Friday.

Australia’s top power and gas retailer said the partnership with Octopus and use of its Kraken platform – a cloud-based system for interacting with consumers and the industry – would radically improve Origin’s customer service, while cutting costs and providing international growth opportunities.

“Our main game is about delivering on that retail strategy and doing it fast and getting ahead of our competitors, which I think we’re putting ourselves in a good position to do,” Origin’s chief executive Frank Calabria told Reuters in an interview.

The acquisition comes as Origin faces pressure from the Australian government to cut retail tariffs and advance its transition to cleaner energy through offering products tailored to customers adopting rooftop solar power, home batteries and electric cars.

For fast growing challenger in the UK energy market Octopus, the deal values the company at over $2 billion and will help it develop its technology and expand into more markets.

“We’re thrilled to be able to accelerate our global expansion to make the green energy transition cheaper and faster,” said Octopus Energy founder and chief executive, Greg Jackson in a statement.