Ocado taps investors for £575m to fund robotic warehouses
Ocado is tapping investors for £575m to accelerate the development of its robotic warehouses.
Ocado, which raised £1bn from investors in 2020 as online sales boomed, is placing a further £575m of shares on the market and launching a separate £6.9m retail offer via PrimaryBid.
Alongside the capital raising, Ocado also secured another £300m revolving credit facility from banks as the business said it needed more cash to bring its technology “solutions to market even faster”.
Ocado is tapping investors for £575m to accelerate the development of its robotic warehouses.
Ocado, which raised £1bn from investors in 2020 as online sales boomed, is placing a further £575m of shares on the market and launching a separate £6.9m retail offer via PrimaryBid.
Alongside the capital raising, Ocado also secured another £300m revolving credit facility from banks as the business said it needed more cash to bring its technology “solutions to market even faster”.
Ocado expects to spend £596m in total capital expenditure this year, including the roll out of 11 warehouses. Next year it plans to double the number to 23 and to keep scaling to reach about 50 by 2026.
This will mean the business will need to spend £700m of annual capital expenditure in the mid-term, but according to a presentation to investors, once it has 50 warehouses open it expects to be cashflow-positive, with its tech solutions operating on a 50% margin and its UK logistics towards a 3% margin.
Ocado has spent £2.7bn in capital expenditure in the past 10 years as it has ploughed money into developing lighter and cheaper robots and warehouses.
Despite being set up as an online supermarket in 2000 by three Goldman Sachs bankers, Ocado has spent the past seven years focused on selling its technology to overseas retail partners, such as Kroger, Aon and Groupe Casino.
The Times (£)
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Image from Ocado
