THE online grocer, Ocado, aims to make its stock market debut by the middle of next month and is expected to make a formal announcement next week.
The company has achieved soaring sales but has yet to make a pretax profit.
Ocado hopes to achieve a valuation of £1bn and has appointed JPMorgan Cazenove, UBS and Goldman Sachs to advise it on the listing.
To boost its entry onto the stock exchange, the company is expected to announce an increase in sales of more than 30 per cent and a doubling of underlying pre-interest profits from £2m for the first half of its financial year.
Ocado, which delivers groceries exclusively for up-market chain Waitrose, part of the John Lewis Partnership, sent a letter to customers two week ago saying it will offer those who have spent over £300 since 1 January 2010 the chance to purchase shares.
It is believed that existing investors will aim to sell around £200m to £250m in shares.
A valuation of about £1bn, including around £100m pounds of debt, would equate to around twice its annual sales but many times even its pre-interest pre-tax profits.
In March Ocado announced an increase in gross sales of 25 per cent to £427.3m and a like-for-like gross sales increase of 22 per cent for the year ending 29 November 2009.
Ocado was founded in January 2000 by investment bankers Tim Steiner, Jason Gissing and Jonathan Faiman.
If successful, the float would value their combined stakes in the region of £160m.
Although the firm is undoubtedly strong in its niche area of the market and is growing revenues fast, its planned flotation comes at a difficult time for the domestic economy. Fears of a cuts-inspired downturn might prompt consumers to switch their preferences to cheaper grocery outlets like Tesco and WM Morrison.
City A.M. Reporter