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Octopus attracts Origin: Sky News
Posted on Tuesday, 24 March 2020 14:13
Octopus Energy has attracted the interest of Australia’s Origin Energy and the two are in discussions regarding a transaction, Sky News reported. Citing sources, the broadcaster said that the companies have been holdings talks about the sale of a large stake in the UK-based energy supplier, which has grown significantly since being founded three years ago. Energy industry insiders told Sky News that negotiations have been ongoing as recently as this month, although it is unclear how the coronavirus outbreak is hampering the ability to conclude a transaction. It is unknown at this time if Octopus is also in discussions with any other third parties about a stake sale. The group has over 1.50 million customers and if the talks with Origin lead to a formal deal, it is likely to value the business at GBP 1.00 billion. Octopus has now established itself as one of the top ten gas and electricity suppliers in the UK. Chief executive Greg Jackson told the Times earlier this year that he has bold ambitions to the company, including reaching five to six million customers in the country within the next three to four years. Shares in Origin rose 6.6 per cent to AUD 4.05 (USD 2.34) at 16:10 today, giving the group a market capitalisation of AUD 7.13 billion. The business recorded underlying earnings before interest, taxes, depreciation and amortisation of AUD 1.59 billion in the six months ended 31st December 2019, representing an 8.1 per cent decline from AUD 1.73 billion in the corresponding period of 2018. Zephyr, the M&A database published by Bureau van Dijk, shows there have been 15 deals targeting UK-based utility providers, including electric, gas and water suppliers, announced worldwide in 2020 to date. Diamond Transmission Partners BBE (Holdings) has agreed to buy Galloper Wind Farm's transmission assets GBP 281.80 million, in the largest of these. © Zephus Ltd