Kroger partners with Ocado

Kroger partners with Ocado

Ocado's shares soared by nearly a third to an all-time high after the online supermarket announced it will build as many as 20 robotic warehouses in the USA as part of a landmark deal with American supermarket giant Kroger that will significantly accelerate its plans to become a global supplier of white-label online shopping technology.

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

Ocado said it will begin setting up Kroger with various systems to help it manage warehouse operations, automation, logistics and delivery route planning in the US.

Ocado, which already works with Sweden's ICA, Canada's Sobeys and France's Casino (as well as Morrisons in its home market), said it had agreed a contract that could see Kroger open up to 20 automated warehouses in the United States over the next three years.

As part of the deal, Kroger is pay GBP183m (US$247.5m) for a 5% stake in the London-listed, online pure-play.

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Shares in Ocado (OCDO) rocket 43% higher to 787.9p following the announcement of a tasty partnership with U.S. grocer Kroger, giving the online grocer-to-e-commerce tech licensor a foothold in the vast groceries market across the pond.

The companies will find three locations for new warehouses this year and said they would find locations for a total. Ocado added that, in the event of a failure to commit to the target capacity, Kroger will pay compensation to Ocado.

The retailer's efforts to create a "seamless digital experience" for customers would speed up as a result, he added.

'A significant milestone in this strategy was marked in November a year ago when the company announced its first overseas deal with France's Groupe Casino supermarket brand - providing the company with the necessary kit and technology to launch its own online offering.

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