RE: Autostore up 16% today29 Dec 2021 23:35
The article - Page 1
"About a year ago, we wrote a piece about how Ocado Group is Becoming a Technology Stock. With no storefronts, Ocado is a U.K. grocery store that operates solely from large warehouses where robots fulfill orders made by people online. The company then began deploying their robotic warehouse solution for other grocery stores that wanted to add online ordering, including Kroger, the second-largest grocer in the United States with 2,800 stores. We ended up going long Ocado, but exited our position because we didn’t want exposure to their UK grocery business which represented 93% of total revenues.
At the time we exited our Ocado position, we also took note of a new entrant – AutoStore Stock: A Warehouse Automation Pure Play. With AutoStore having a successful initial public offering (IPO), we saw this stock as a great pure play on the growth of warehouse automation which is estimated to be upwards of a $240 billion opportunity.
With around 10% of AutoStore’s revenues coming from Retail & Grocery, you would think that Ocado Group wouldn’t be posing much of a threat. In fact, both companies might have been able to work together. At some point in time, Ocado approached AutoStore about a potential business partnership and met to discuss the potential relationship, but the parties never reached an agreement. Today, they’re engaged in what appears to be a ****ing contest that started out in October 2020 when AutoStore filed patent infringement lawsuits in the United States and the United Kingdom against Ocado Group. In early 2021, Ocado filed counterclaims against AutoStore in the United States, the United Kingdom, and Germany.
Several weeks ago, AutoStore’s initial attack against Ocado Group was thwarted when a judge ruled against the Norwegian firm in the United States.
Judgment in the ITC trial was delivered on 13 December and the Chief Administrative Law Judge has found in favour of Ocado. He held that three of the four AutoStore patents are invalid. The fourth is not infringed. A fifth patent was abandoned by AutoStore the night before the trial.
Credit: Ocado Group
The outcome only means that AutoStore cannot keep Ocado from operating in the United States, which was the intent of the lawsuit. The firm has now wasted loads of money on a lawsuit they didn’t win, and in doing so, managed to wake a sleeping giant."
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