Origin’s Octopus adds 2m customers in Shell deal

afr.com:

Origin Energy’s partly owned Octopus business in the United Kingdom will add two million customers after striking a deal to buy Shell’s energy retailing business in the UK and Germany.

The acquisition, announced in the UK on Friday, may increase questions around the valuation of Origin’s 20 per cent stake in Octopus, which looks set to be a key issue of contention in the independent assessment of the $18.7 billion takeover proposal for Origin that is currently under way.

Octopus CEO Greg Jackson said Shell and Octopus would also examine an international partnership in EV charging. Domenico Pugliese

Neither Shell nor Octopus gave the price of the deal, but Reuters cited sources that had previously estimated the value of the Shell business at between $US50 million ($77 million) and $US100 million.

The transaction will increase Octopus’ UK retail portfolio to nearly 6.5 million household customers in the UK, while its customer base in Germany will grow to almost 300,000. Octopus and Shell also agreed to explore an international partnership in electric vehicle charging as part of the deal.

Shell flagged this year it would look to sell its retail business in the UK and Germany and ran a competitive process for the portfolio, which includes 1.4 million household energy customers and 500,000 broadband customers.

Octopus is already the second-largest energy retailer in the UK, having last year picked up the Bulb business, the biggest of several retailers to collapse in 2021 amid surging wholesale energy prices and regulated price caps. It had 1.5 million customers.

Shell announced a strategic review of its UK and European household energy business in January, citing tough market conditions, and later confirmed it would sell the