Economy

Ocado to enter U.S. market with 'transformative' Kroger deal

Ocado to enter U.S. market with 'transformative' Kroger deal

Ocado Group Plc's agreement to license its home-delivery technology to US supermarket chain Kroger Co. is the online grocer's biggest deal so far, and a "materially larger" pact than Bernstein's expectations.

Ocado said its "transformative" entry into the U.S. market centred on sharing its technology with Kroger, which had annual sales of $122bn (£90.4bn) in 2017. It started distributing groceries for Waitrose and floated in 2010.

Ocado shares were trading nearly 80% higher on Thursday afternoon - reaching £10 per share at one stage.

The Kroger deal will see the American grocery giant take a 5% stake in Ocado with an investment worth about -183 million ($247 million). A total of 20 will be identified in the first three years of the deal.

Chief executive Tim Steiner, said: "Ocado's unique, proprietary and industry-leading technology is set to transform the shopping experience of consumers around the world".

Ocado said that it predicts the deal will have a neutral impact on its earnings this year.

More news: EU Must Defend Firms against US Iran Sanctions: Macron

With a net short position of one per cent, according to regulatory filings, Marshall Wace booked a paper loss of around £15m within minutes after Ocado shares rose 40 per cent this morning.

"Our success as a retailer shows that we can offer customers unrivalled choice, quality and convenience, efficiently and profitably".

Thursday's announcement is a "more major positive" than previous deals, because Kroger is one of the largest food retailers in the world and the agreement for multiple customer fulfillment centers seems to be under favorable terms.

Rodney McMullen, Kroger's chief executive, said the partnership would the grocer "redefine the food and grocery customer experience - creating value for customers and shareholders alike". The short sellers were hoping Ocado wouldn't deliver on its global expansion plans, that position now looks like a badly busted flush.

"Shares are priced for these deals to be coming thick and fast".

The news sent Ocado's shares up 31pc in early trade to 725p.


  • WWE is already giving Ronda Rousey a title shot

    WWE is already giving Ronda Rousey a title shot

    WWE announced Monday at the NBCUniversal Upfront that Rousey will face WWE Raw Women's Champion Nia Jax at the Money In The Bank pay-per-view on June 17th in Chicago.
    First stars formed 250 million years after Big Bang

    First stars formed 250 million years after Big Bang

    Basic elements like oxygen, carbon and nitrogen weren't very common until the first stars had fired up, burnt out and exploded. The distance to the galaxy determined from this observation is consistent with the distance from the oxygen observation.
    Bumrah leads Mumbai to win over Punjab

    Bumrah leads Mumbai to win over Punjab

    But Mumbai turned out to be a slightly different side that day in Indore , and Kings XI have not been the same side ever since. But again, in Bumrah's over, he managed just a single off the second ball. "Bumrah has come a long way in the past two years".
  • SC collegium fails to send judges' names

    SC collegium fails to send judges' names

    The collegium had earlier chose to consider other names from various high courts for appointment as SC judges and had deferred the deliberations to May 16.
    Whitney Houston was molested by Dee Dee Warwick, new documentary says

    Whitney Houston was molested by Dee Dee Warwick, new documentary says

    The Guardian has contacted representatives of the Warwick family for comment on the allegations. Get all your Whitney-related questions answered when the film hits theaters July 6.
    Everton Announces Departure of Sam Allardyce

    Everton Announces Departure of Sam Allardyce

    Watford "remain furious" that Everton's interest past year unsettled Silva and a poor run of form led to his sacking in January. Everton said in a statement: "We have made the decision, as part of our longer-term plan, we will be appointing a new manager".
  • Iowa State men's golf makes NCAA Championships

    Iowa State men's golf makes NCAA Championships

    Napier ended the tournament only one stroke behind three players tying for 26th place and within two of claiming a top-20 finish. The top five teams at the end of the tournament advance to the NCAA Championships and Augusta is five shots out of fifth place.
    Golden Knights top Jets 4-2, take 2-1 series lead

    Golden Knights top Jets 4-2, take 2-1 series lead

    It began with Kyle Connor panicking when he got the puck in his own zone, poking it right to the Vegas defender. He came back to break a 1-1 tie with his second-period goal, and he added an assist a couple of minutes later.
    Atletico Madrid Win Third Europa League Title

    Atletico Madrid Win Third Europa League Title

    But the France worldwide is linked with a move to Barcelona in the close-season despite being contracted until 2022. Atletico Madrid has won three Europa League titles, including the 2009/2010, 2011/2012 and the 2017/2018 editions.
  • OnePlus 6 launched to universal acclaim

    OnePlus 6 launched to universal acclaim

    More than 1,500 fans and media attended the global launch of the OnePlus 6 at the Copper Box Arena in London. However, what makes this screen so great are the wallpapers that OnePlus has included on the OnePlus 6 .
    Utah Tesla driver had hands off wheel before crash

    Utah Tesla driver had hands off wheel before crash

    Furthermore, it's now the fourth investigation into a crash involving a Tesla vehicle in just 2 months, which might be a record. The driver had previously told police that she had engaged the autopilot and was "looking at her phone prior to the collision".
    Coastal Awards rank Welsh beaches among the best in the world

    Coastal Awards rank Welsh beaches among the best in the world

    Whitby has been given the award, so those visiting can be sure of a clean, safe beach with great facilities and water quality. In total, 65 global Blue Flags and 125 Seaside Awards (8 more than last year) have been handed out this year.