From retailer to tech titan: Ocado signs landmark US deal
Online-only supermarket group Ocado has struck a major technology deal with one of the world's largest grocery retailers.
Kroger will take a 5 per cent stake in Ocado for £183m and will have exclusive rights to the company’s technology in the US. It will be used for grocery and other food distribution related activities.
Kroger is one of the world's biggest grocery retailers, with sales of $122bn.
"Ocado's unique, proprietary and industry-leading technology is set to transform the shopping experience of consumers around the world," said chief executive Tim Steiner.
He added: "The opportunity to partner with Kroger to transform the way in which US customers buy grocery represents a huge opportunity to redefine the grocery experience of Kroger's customers and create value for the stakeholders of both Kroger and Ocado.
"As we work through the terms of the services agreement with Kroger in the coming months, we will be preparing the business for a transformative relationship which will reshape the food retailing industry in the US in the years to come."
Rodney McMullen, chairman and CEO of Kroger, said: "We see Ocado as an innovative, exciting and transformative partnership in pursuit of our Restock Kroger vision, to serve America through food inspiration and uplift.
"We are actively creating a seamless digital experience for our customers. Our partnership with Ocado will speed up our efforts to redefine the food and grocery customer experience - creating value for customers and shareholders alike."
Ocado saw its shares soar following the announcement, closing 45 per cent higher on Thursday.
The company said it's already working with Kroger to identify the first three sites in 2018 for development of new, automated warehouse facilities in the US, and will identify up to a total of 20 over the first three years of the agreement.