Octopus Energy Ltd. has signed a deal to acquire Shell PLC’s power and domestic gas units in the UK and Germany, the British companies said.
The agreement between Octopus and Impello Ltd., a subsidiary of Shell Petroleum Co. Ltd., to buy Shell Energy Retail Ltd. in both countries follows Shell PLC’s announcement on June 6 that it intended to exit its domestic energy businesses in Germany, the Netherlands and the United Kingdom.
The move announced separately on Friday by Octopus and Shell Petroleum transfers 1.4 million home energy customers and 500,000 broadband customers to the new owner, according to an Octopus press release.
Neither disclosed the value of the transaction.
“This deal grows rival energy supplier Octopus to almost 6.5 million household customers in the UK (over 11 million metering points),” Octopus said. “Is [Octopus] customer base in Germany will grow to almost 300,000”.
Subject to regulatory approval, the deal is expected to close in the fourth quarter, the two companies said, assuring customers of a smooth transition.
There will be no disruption to energy supply as a result of the new ownership, Octopus said, adding: “Customers’ credit balances are protected and will automatically transfer to their new account with Octopus along with their existing direct charges”.
“Tariffs and offers will remain unchanged for all existing home energy customers, including continued access to 100 percent renewable energy,” Shell Petroleum said in its own announcement.
“Octopus has a strong track record in large-scale customer migrations through its proprietary Kraken technology platform,” said London-based Octopus, which does business across the energy value chain. “The company recently completed the transfer of 1.5 million customers from Bulb in just six months, an industry record, while maintaining its award-winning customer service levels and its status as a Recommended Energy Supplier by sixth year in a row.”
The purchase of Shell Energy comes six months after Octopus completed the acquisition of Bulb Energy Ltd., as announced by Octopus on December 21, 2022.
Bulb’s takeover of Octopus had been approved by the UK government to save the bankrupt provider’s 1.5 million customers, according to a press release on the government’s website on October 29, 2022.
Octopus chief executive and founder Greg Jackson said in a statement about the Shell Energy purchase: “After a rigorous process, we are delighted to acquire Shell Energy Retail in the UK and Germany.”
“Octopus has proven to deliver a game-changing service while relentlessly innovating and investing towards a cheaper clean energy system,” Jackson added.
Shell Energy executive vice president Steve Hill said in a statement: “To drive performance, discipline and simplification, we are prioritizing countries, projects and routes to market where we can deliver the most value. We will work closely with Octopus to ensure a seamless transition and a continued high level of customer service”.
Shell PLC announced on June 6 that it had decided on the divestment after a “strategic review” but was keeping its wholesale energy business as well as its retail home energy business outside of Europe . “Nor our B2B [business to business] wholesaler and SMEs [small and medium enterprises] Customer supply businesses under the Shell Energy brand, or our retail home energy businesses outside of Europe, are within reach of this potential divestment,” he said.
Shell Petroleum and Octopus have also agreed to explore a possible global partnership. The planned collaboration includes electric vehicle (EV) charging, as well as “possible joint promotions and brand activations, along with cooperation on out-of-home charging and other activities across the EV value chain,” Shell Petroleum’s press release said. “Shell is already a leading provider of charging for electric vehicles with a global charging network expected to expand to around 200,000 public charging points by 2030.”
To contact the author, please email jov.onsat@rigzone.com
