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Ocado Amazon

Ocado teases ‘signing an international deal’ as Amazon speculation mounts


By Jennifer Faull, Deputy Editor

February 2, 2016 | 2 min read

Ocado has teased analysts, saying that “discussions with multiple potential international partners to adopt the Ocado Smart Platform solution” are on the table and its “confidence in signing a deal remains high," adding yet more fuel to speculation e-commerce Amazon is eyeing a bid for the delivery firm to boost its fledgling grocery offering.

Murmurings of an Amazon tie-up have been ongoing since a Daily Mail Market Report published last month (19 January), which suggested Amazon has "advisers beavering away on a potential move for the British online supermarket”, leading shares to jump 18 per cent.

For Amazon a deal of this ilk would chime with its ambition to ramp up its Pantry offering in the UK, following its launch in November, and add fresh food items to the line-up. However, it would need to invest in a storage and delivery infrastructure that could support it, which is where Ocado would come in.

More eyebrows were raised with Ocado’s appointment of Andrew Harrison, the current deputy chief executive of DixonsCarphone, as a new non-executive director last week. Harrison has plenty of experience when it comes to navigating the shaky terrain of merging two massive companies, having been at the helm of Carphone Warehouse when it struck the £3.5bn merger deal with Dixons in 2014.

Chief executive Tim Steiner didn’t comment further on potential deals as he reported a strong performance for the year to November 2015 today (2 February).

Pre-tax profit was up 65 per cent and gross retail sales rose to £1.1bn for the year, up 14.7 per cent 2014.

Its customer base also jumped 20 per cent with active customers up 12.4 per cent to 509,000. This was reflected in order volumes which increased 16.8 per cent to an average of 195,000 orders per week.

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