Business
In principle agreement with Morrisons
In principle agreement with Morrisons.
About this update from Ocado Group Plc
[{"type":"text","content":"\n \nRNS Number : 3900Q Ocado Group PLC 29 February 2016 \n\nOcado Group plc\nAnnouncement of in principle agreement with Wm Morrisons Supermarkets plc (\"Morrisons\")\nOcado is pleased to announce that it has agreed headline terms with Morrisons for it to share some of the capacity of Ocado's customer fulfilment centre (\"CFC\") currently under construction in Erith, south east London. Under these terms Ocado will also provide Morrisons with the software necessary to fulfil online orders from its stores, primarily intended to enable online services in areas not currently serviced by a CFC.\nThe parties are working on the detailed terms of the agreement; there can be no certainty that an agreement will be reached.\n \nTerms for Morrisons' capacity in Erith\nThe parties first entered into their agreement for online grocery fulfilment services in 2013 (the \"Operating Agreement\") with Morrisons sharing the capacity of the Dordon CFC.\nThe Erith CFC is due to go-live at the end of 2017 and is expected to have capacity of 210,000 orders per week.\nSince the original agreement, Ocado has launched the Ocado Smart Platform (\"OSP\"), and so in principle the new terms for capacity in Erith will be structured in a similar way to those offered to international OSP customers with lower upfront capital costs and with ongoing annual fees dependant on capacity. \n \nTim Steiner, CEO of Ocado, said:\n\"We are delighted to have reached an in principle agreement with Morrisons. This is a win-win arrangement which allows both of us to grow faster, and more profitably, in a grocery market where channel shift is now an unquestionable reality.\n\"This potential deal demonstrates Ocado has the technology and know-how to help partners grow their online businesses rapidly and successfully, and take advantage of consumers' increasing desire for the convenience, choice, quality and value offered by online shopping and enabled by the Ocado Smart Platform\".\n \n \n \nContacts\n● Tim Steiner, Chief Executive Officer, on 01707 228 000\n● Duncan Tatton-Brown, Chief Financial Officer, on 01707 228 000\n● David Hardiman-Evans, Head of IR & Corporate Finance, on 01707 228 000\n● David Shriver or Michelle Clarke, Tulchan Communications on 020 7353 42...