UK online retailer Ocado plans to send out a prospectus to potential investors for its long-mooted IPO within the next two to three weeks, it was reported today (3 June).
A report in the Wall Street Journal cited people familiar with the situation who indicated that Ocado was gearing up for a flotation, although the company has remained coy about any timetable.
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In March, finance director Andrew Bracey told Reuters that Ocado wanted to list after the UK General Election although exact details were not revealed.
Industry watchers have questioned whether Ocado could mount a successful IPO, pointing to other failed flotations in the UK this year, including a planned listing by clothing retailer New Look.
There has also been uncertainty over the future relationship between Ocado and upmarket UK retailer Waitrose.
Ocado was originally set up to sell Waitrose goods online. Since then, Waitrose has itself launched Waitrose Deliver, its own online operation.
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By GlobalDataThere had been question marks over Waitrose’s commitment to Ocado, with the tie-up between the two set to end in 2013.
However, last week, the two companies extended their deal and now Ocado can sell Waitrose’sproducts until 2020.
The new agreement could provide a boost to Ocado’s flotation plans and to the valuation the retailer hopes to achieve from the listing.
One person familiar with the matter told the WSJ that an IPO could value Ocado at between GBP500m and GBP1.5bn.
However, some commentators believe Ocado will need to lay out a strong strategy for growth, including geographical expansion, to convince potential investors.
Officials for Ocado could not be reached for immediate comment.
