Marks & Spencer, the UK department store chain, has announced it has partnered with digital grocery specialist Ocado to create its first major platform for online grocery retail.
Under the joint venture, M&S is acquiring a 50% share of Ocado’s UK retail business, which will be supported by Ocado Smart Platform, for a total consideration of up to £750 million ($999 million).
Marks & Spencer said the venture would trade as Ocado.com but benefit from access to the M&S brand, products and customer database from September 2020 at the latest, when Ocado’s existing agreement with upmarket supermarket chain Waitrose is set to expire.
The retailer said the deal “combines the strength of M&S’s brand and its leading food quality and innovation with Ocado’s unique and proprietary technology to create an unrivalled online offer for our customers”.
Marks & Spencer CEO Steve Rowe said: “I have always believed that M&S Food could and should be online. Combining the strength of our food offer with leading online and delivery capability is a compelling proposition to drive long-term growth. Our investment in a fully aligned joint-venture with Ocado accelerates our Food strategy as it enables us to take our food online in an immediately profitable, scalable and sustainable way”.
“This is a transformational step forward in shaping the future of M&S and in becoming a truly digital first retailer with at least a third of the business online”.
Source: Marks & Spencer