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One intriguing outside possibility is that Autostore and Ocado in time merge, or there is a takeover/ reverse takeover of one party by the other.

There's acrimony currently between the two but if the courts cases amount to little success by Autostore then the next step for them maybe for Autostore to buy into Ocado assisted by their investor SoftBank

There is much to gain from the 2 companies being put together. Ocado has overwhelmingly grocery clients, Autostore has overwhelmingly non grocery clients. Both companies have a huge range of partners and contacts. If together then many synergies could be made. Reduced cost of robotic development. Reduced cost of buying tech etc etc.

It's a longshot but it's one to watch..

Thanks loads for that link ed_win. Treasure trove of great info. Sifting through that all currently.

I can't see Fortress or other private equity companies bidding for Ocado currently. Around 90% of the Ocado group is a tech company. It's a possibility but generally they favour bidding for companies with a strong cash flow. Ocado is consuming a lot of cash currently and will do so for a few more years as the CFC network is built out around the world. After that strong cash flow will come and private equity may well be very interested.

I agree with you that the price is very low. Ocados future prospects are undervalued currently. Many, many companies would love to have Ocados technology. There may well be a takeover bid from Amazon, Kroger, Uber or any other large company that wants to acquire the fully automated grocery delivery logistics solutions that Osdo have developing and are fine tuning daily.

Very interesting article below. With this fully automated tech, that they will showcase in the newly ordered Kroger Florida CFCs, Ocado then have the capability of selling this tech to a variety of customers who utilise smaller scale distribution centres/dark stores. Another step Ocado is taking to appeal to a greater variety of customers. Won't take very long for the Florida mini CFC to be built. Their robotic solution will outshine those who rely on mountains of human labour as time progresses..

https://www.thegrocer.co.uk/ocado/ocado-says-robotic-picking-system-will-soon-work-in-very-small-warehouses/660971.article

Delta rising rapidly in the UK who now has one of the world's highest covid cases rates. New variant of delta (AY.4.2) circulating in the UK and cases being found in the rest of the world. NHS leaders demanding the government imposes restrictions before hospitals, who are trying to cope with the huge backlog in procedures, come under too much strain. Booster jab drive has been far too slow in the UK. Waning immunity amongst the population.

So many reasons to believe Ocado retail UK revenue will grow over the coming winter period...

Ocado has been a buy since the recent pivotal announcement by Kroger to use the breadth of Ocados technology. It remains a buy today.

Autostores IPO has floated successfully in Oslo today. Their shares are up 9.7% at time of writing

https://live.euronext.com/en/product/equities/BMG0670A1099-XOSL/market-information

This values Autostore at around £10bill, Ocado value is £13.6bill

Human run dark stores v robotic dark stores. Ocado ahead in the self driving vehicle race. Having invested early in 2 different systems of self drive.

My crystal ball says Getir will merge/takeover others and utilise robotics in a far greater fashion than it does now. Go forward some years and Ocado CFCs will, via utilising kindred system/Haddington dynamics robotic arms, be extremely highly automated. All of the robotics in CFCs mini and large will learn from each other.

There's room for many competitors in the market. It's who has the leanest, most profitable model with least waste, most environmentally friendly (Ocado vertical farms), least human intervention etc that will win the most coveted prize. That will be that others will seek out and use their systems across the globe. Huge revenue stream for the best online grocers of 2025 onwards..

Probably - eventually though labour regulation, negative press and the inefficiencies of human labour weigh down that business model...

Low tech will work for a while but in the end the optimum model will win out. Much pressure all around to increase wages for delivery drivers. Labour costs will rise over time, tech will undercut the costs in time..

Getir are a well run outfit expanding rapidly by the model you outline chilting. Similarly to the start of online grocery delivery in this country, ultra fast delivery is undergoing a market share grab expansion at the moment. Special offers everywhere, many companies trying to carve out a future in this smaller grocery market.

Ultimately it will be those with the best operating models who survive. This is where robotics will need to be utilised in the sectors dark stores to gain the profit edge.

Kroger are rolling out Ocado zoom as it's a profitable, tested solution to the ultra fast delivery segment. Apart from Ocado zoom expanding across the globe I can see Ocado supplying robotics to other ultra fast grocery delivery companies in the future.

Luke Jensen has commented on the ultra fast grocery delivery sectors outlook recently -

“The amount of money that’s being put against this opportunity is grossly disproportionate to the size of the opportunity,”

"“I suspect there will inevitably be a lot of consolidation among these players.”

Great post Ney, always good to read your insights.

Currently there's massive potential within Ocado. The level of which isn't fully priced into the share price. As this potential turns into reality, as in the recent Kroger announcement to use all facets of Ocados technology, then the share price rises. Once the complete Ocado story unravels in some years time I believe Ocado will have either been taken over or have a share price far higher than today.

Ocados technology is central to the future, they have a headstart and heavily patented technology in the crucial battleground of online grocery and incredible possibilities to use this tech in other lucrative areas..

Great week but it's just the beginning of what's to come. I believe the share price will retest it's historic highs in time. When will it get there? I don't know, it can be blown all sorts of directions before then but Ocados extremely strong management team know how to progress and escalate this business.

Many shorting this stock will be rethinking in the wake of the incredible announcement from Kroger to use all aspects of Ocados Solutions technology off the back of excellent performance scores on the currently operational Ocado Florida CFC.

Great likelihood that before long Groupe Auchun will be using Ocados technology more widely across their group than the current Spain only contract.

Plenty of wind in Ocados sails now and a bigger, stronger foundation for the business to expand from..

Best to all

Ocado could enter Germany on its own as per below comments this year from Tim Steiner.

https://www.ft.com/content/e0e1e9a2-b617-45a6-8dfe-06feeff0b6de

His comments are probably designed to flush out and hurry up other potential partners to join Ocado as Solutions partners. They could go it alone in viable markets where no suitable partner exists. Most probably this would happen in conjunction with a major financing partner as the costs of rolling out overseas CFC networks would be great.

Interesting that it's believed Kroger have chosen to expand early in the North East of the USA (where they have very little store presence) because the current Florida Ocado CFC has exceeded expectations and performed so well (Kroger similarly have little store presence in Florida)

https://www.retailwire.com/discussion/stores-kroger-dont-need-no-stinking-stores/

The comment section below the above article is a good read also. Lots of experts giving their different views on the Kroger/Ocado partnership..

Interesting article re the recent Kroger 5CFC expansion and what its details tell us..

https://www.grocerydive.com/news/pardon-the-disruption-kroger-is-showcasing-its-range-with-ocado/608166/

For me Kroger announcing they are to build an Ocado zoom CFC was the pick of many surprises in the recent Kroger announcement.

Kroger have 3,242 stores in the US currently, see below for a map of their distribution

https://www.scrapehero.com/kroger-store-locations/

The initial commitment in the Ocado contract to build 20CFCs always looked a small amount but it depended on the extent Kroger were wanting to develop the Ocado CFC concept across the US. Now we are seeing that they are building further CFCs in areas where they have a big store presence and areas where they have little presence. We see now that they are also committing to build an Ocado zoom CFC.

Just a month ago Kroger entered a deal with Instacart enabling Instacart gig economy workers to collect and deliver customer orders inside 30 mins from the entire Kroger store network.

https://retailtechinnovationhub.com/home/2021/9/15/kroger-and-instacart-launch-kroger-delivery-now-in-us

So there was a bigger question mark after that announcement as to whether Kroger would use the Ocado zoom service. Now, as a result of the first confirmed Ocado zoom site, it looks as though there's a great chance Kroger want to develop Ocado zoom CFCs across the US. It very much looks like the Instacart deal is a temporary solution Kroger will use until the extra Ocado CFC network can be built. If this happens then we are talking about a very large amount of extra micro CFCs in addition to the network of large CFCs they are already building.

For Ocado it will be a great new revenue stream opening up and a bigger foothold in the rapidly expanding immediate grocery delivery space. As more CFCs are built by Ocado they learn how to build better, quicker and cheaper. The new CFCs using the breadth of Ocados tech will be yet more shop windows for Ocado to show other prospective clients.

Given Kroger have a 6% stake in Ocado they will want to advertise and promote their CFCs wherever possible...

An out of court settlement is very possible. Also possible that Autostore could lose some of the patents Ocado is challenging. Ocado could receive damages /legal costs from Autostore. Many possibilities out there. Tim Steiner has talked for many years how central importance Ocados patents are to its business. It's not an area management have taken for granted.

Cheers Jimmy,

We are not out of the woods yet but Ocado is now on a firmer financial position after yesterday's Kroger announcement. The use by Kroger of the whole breadth of Ocados technology (30 min delivery, same day and next day) sets up the very intriguing prospect of the current 20 CFC contract being extended by a big margin.

There are headwinds out there for Ocado. Energy/HGV/supply chain/ CO2 crises all occuring together but I believe Ocados management can steer a successful course through these issues.

Momentum has swing wildly in Ocados favour. Of course Kroger have 6% ownership of Ocado so they very much want their investment to grow however yesterdays announcement was about more than that. It was Kroger saying we want a closer deeper relationship with Ocado. They see Ocado as a central plank in their strategy of combatting Walmart/Amazon.

Of course there is the Autostore v Ocado legal case risk out there. We should all read and research that as much as possible. Personally I believe the risk for Ocado to be less than the market is factoring in.

Ocado shares are at a low ebb but the tide is changing and the future for the company, as a result of yesterday, is brighter than ever....

So you did Grimmmm2012. Thanks for posting solid information to this board. Hope you can post again soon.

On first glance you could say 5 more CFCs isn't such big news but actually it's bigger than it sounds.

Kroger have already committed to 11CFCs so this is CFC 12, 13, 14, 15 and 16 announced today. Krogers contract with Ocado commits to building 20cfcs.

First up as mapper points out this is Kroger showing they are confident in that Ocados patents are rightfully theirs. Also it cements these further CFCs in Ocados future cashflow projections. It's one thing to plan to build 20cfcs, until the CFCs are announced though it's just plans. 5 further CFCs became reality today and the market is currently pricing that in.

Kroger entering the Pacific northeast is a great sign. They're entering a completely new geography. Suggests Kroger plan to open CFCs all across America regardless if they have a store network present or not.

Crucial point here is that the new 2 X California CFCs and the north east CFC will supply deliveries to customers next day and same day. So Kroger are committing to utilising Ocados tech to supply same day. Same day delivery Ocado hasn't has much commitment to from overseas partners so it shows Kroger believe in the tech and it's adaptability.

Lastly the 2 X Kroger Florida CFCs will have zoom capability so will facilitate deliveries to customers in 30 mins or less. Ocado only have the current London Acton site in zoom operation and there has been a question mark over whether overseas customers will use Ocado for ultra fast delivery.

Today Kroger have given Ocados tech a huge validatory thumbs up and between the lines one can believe that Kroger plan to build far more than 20cfcs with Ocado. They want Ocado to fulfil Kroger online demand all over the country at ultrafast, same day and next day capability.

It points to the probability of other partners adding to their CFC orders with Ocado in the future..