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Octopus Energy has raised $800mn from investors in a fundraising round that has boosted its valuation to almost $8bn.
The UK-based energy retail, generation and software company now values itself at $7.8bn, up from $4.6bn in 2021.
The Canada Pension Plan Investment Board is putting in $326mn — the largest amount — to raise its stake from 6 to 11 per cent, while Origin Energy is investing $305mn to increase its stake from 20 to 23 per cent.
Octopus was founded in 2015 by chief executive Greg Jackson, and has grown rapidly to become the UK’s second-largest household energy supplier after it bought Shell’s UK household supply division this year.
As well as its retail arm, it has a growing portfolio of renewable energy projects, which it said was worth £6bn, and licences its Kraken software which helps energy retailers manage their accounts.
Overall, it now has a presence in 18 countries including Spain and the US.
Jackson said the money would help with expanding globally “every part of the ecosystem”, with a particular push on accelerating the rollout of heat pumps, a lower carbon alternative to heating compared with gas-fired boilers.
“We will invest to accelerate our growth and create a truly global clean energy giant,” he added.
Frank Calabria, chief executive of Origin Energy, said the company’s success since it first invested in May 2020 had “exceeded all expectations”.
Octopus’ rising valuation was cited as Origin Energy shareholders this month blocked a near-$13bn takeover bid led by Canadian asset manager Brookfield.
Shareholders complained the bid did not recognise the value of Origin’s stake in Octopus.
Bill Rogers, global head of sustainable energies at CPP Investments, said it was “delighted to further our investment in Octopus and enable the expansion of their future energy solutions”.
In November, Octopus launched a new fund to invest £3bn in offshore wind by the end of the decade, with a £190mn cornerstone investment from Tokyo Gas, the Japanese utility that owns almost 10 per cent of Octopus.
Octopus’s international expansion comes amid a tough environment in the UK retail energy market.
Last week, Ofgem, Britain’s energy regulator, opened a consultation on allowing suppliers to raise bills to help them cope with record levels of customer debt.
While wholesale prices have come down since record highs last winter, bills are still higher than before the start of the energy crisis in late 2021, while blanket government support for consumers has ended.
