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Ocado rises in hopes it will benefit from merger of America’s two largest supermarkets
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Ocado shares skyrocketed in hopes it would benefit from a merger of the two largest supermarkets in the US.
The tech company turned supermarket is supplying automated storage technology to US giant Kroger.
And rumors that Kroger — America’s largest supermarket — was partnering with Albertsons, its biggest rival, sent Ocado shares up 10.9 percent, or 42.7p, to 435.8p.
Robo Shoppers: Ocado Delivers Its Automated Storage Technology to US Giant Kroger
Kroger is the largest user of Ocado’s technology, which picks and packs grocery orders, ready for delivery.
The Hertfordshire-based company signed a deal with Kroger in 2018 to help it ramp up its delivery business using Ocado’s robotic warehouses.
The potential deal between Kroger and Albertsons, reported by Bloomberg, could open the door to a massive expansion of Ocado’s transactions in the US, accelerating the path to making a profit.
The deal would create a supermarket giant worth £41 billion, almost three times the size of Tesco, the UK’s largest supermarket.
Ocado, meanwhile, said customers are shrinking their shopping carts and switching to cheaper products as the rising cost of living leads to it.