Online retailer Ocado has announced plans to float on the stock market after the general election and will use some of the proceeds to build a second distribution centre.
Finance director Andrew Bracey said that the web retailer wants to IPO on "the other side of the election".
The company could look to raise around £150 million from selling new shares, and the company could have an enterprise value of £1 billion. There are rumours it is looking at non-food sales, much like its main rival tesco.com.
Bracey told Reuters that initial feedback from City analysts and investors about the IPO had been "very, very good", although Ocado's possible flotation has attracted a degree of scepticism as the group is not yet profitable on a pre-tax level.
Bracey said that he is confident that an IPO would go well and that the move was likely to be in the summer.
But the main point of concern lies in the viability of the business if Ocado’s contract to sell Waitrose food, which runs out in 2013, is not renewed.
But Bracey said that he was confident that Waitrose will renew its contract in 2013 and that their relationship will continue "for the foreseeable future".
He said: "People who have got a differentiated offer, either because they have a unique proposition or because there's growth - or because there's both - when they have come to the market, [the IPO] has gone well."
Ocado was launched in 2000 by three former Goldman Sachs bankers and it counts Jorn Rausing, the packaging magnate, Procter & Gamble, the consumer goods company, and Al Gore, the former US vice-president among its shareholders. The online retailer is chaired by the former ITV and BBC boss Michael Grade.
No comments yet