Shares in Ocado soared over 40 per cent this morning following speculation that Amazon is eyeing a takeover of its grocery technology business.
The tech giant is reportedly mulling an £8-a-share move, The Times has reported, with Goldman Sachs and JP Morgan said to be acting for the potential bidders.
“Bid chatter helped lift web-based food delivery firm Ocado,” said Danni Hewson, head of financial analysis at AJ Bell.
“The shares have been about as flat as an open bottle of lemonade since the pandemic but third parties, including reportedly Amazon, may still see value in the brand, technology and infrastructure.”
Ocado’s share price has suffered in recent years, falling nearly 50 per cent, the company once saw success during the pandemic as Brits in lockdown turned to its home delivery arm to access groceries.
Its grocery delivery service operates via a tie-up with M&S. However it also has a strong automation arm which accounts for much of the group’s business and earnings.
Ocado’s most recent full year results for 2022 show its UK solutions and logistics grew 13 per cent to £802.7m.
This is compared to its retail division which made a 3.8 per cent loss.
City A.M. has contacted Ocado, JP Morgan, Goldman Sachs and Amazon for a comment.