M&S to ‘transform online grocery shopping in UK’ with Ocado deal
27 February 2019
M&S has bought a 50% stake in Ocado’s UK retail business to leverage its fulfilment expertise to deliver M&S food to UK homes.
M&S is paying Ocado up to £750m for its 50% stake in the JV; £562.5m on completion and up to £187.5m, plus interest, payable after five years, conditional on reaching agreed financial and operational targets.
The JV will trade as Ocado.com but access to the M&S brand, products and customer database from September 2020 at the latest.
Ocado has terminated its existing agreement with Waitrose.
The JV provides M&S with a profitable, scalable presence in online grocery, where currently it has a minimal presence.
The Ocado OSP technology provides an infrastructure solution to automate order fulfilment. Ocado serves over 700,000 customers, offering over 50,000 products and fulfilling over 290,000 orders a week.
For the 52 weeks ended 2 December 2018, the newly created JV would have generated revenue of £1,468m and EBITDA of £34.2m.