Ocado secures €671 million in funding for tech rollout
Group fitting out a pipeline of more than 50 “customer fulfilment centres” for supermarket clients around the world
22 June 2022 | 0
Online retailer Ocado has raised £575 million (€671 million) from investors to secure funding for the expensive roll-out of its grocery ecommerce technology.
The company, which benefitted from the rise of online shopping during the Covid-19 pandemic, said on Monday that it had sold 72 million shares to existing and new institutional investors at 795p each.
The Financial Times reports Ocado raised an additional £3m through selling shares to management and in a separate offering designed for retail investors.
The group’s share price fell by approximately 5% on Tuesday morning.
The fundraising comes in the midst of the sell-off in technology stocks, a consumer slowdown in the UK and a reversion to pre-pandemic shopping habits – all of which when combined are resulting in slowed growth at the group.
Ocado said its new funds would allow it to help customers, which include Kroger in the US and Australia’s Coles, to develop online grocery businesses.
Ocado is currently fitting out a pipeline of more than 50 “customer fulfilment centres” for supermarket clients around the world. Kroger, its single biggest client, is expected to require about 20 of the units, which cost tens of millions of pounds each.
Ocado only receives revenue from its technology clients only pre-agreed order processing capacity is reached. The group therefore needs substantial funds to pay for the development.