Milestone as online grocer Ocado set to enter FTSE 100 following global deals
Ocado is set to be catapulted into the FTSE 100 for the first time after a string of high-profile international deals led to its shares soaring.
The online grocer secured a deal with US giant Kroger earlier this month, which resulted in its share price rising by more than 40%, embarrassing short-sellers in the process.
Now, Ocado looks set to be promoted to the FTSE 100 when a reshuffle of the blue-chip index takes place tomorrow.
Laith Khalaf, senior analyst at financial services firm Hargreaves Lansdown, said: "Ocado looks likely to enter the FTSE 100 for the first time after a sensational year which has seen the share price treble.
"The company has managed to sign deals in France, Sweden, Canada and the US to license out its market-leading online delivery technology.
"Ocado has for some time been a popular stock for hedge funds to bet against, but now just 5% of the company's shares are in the hands of the short sellers compared to 13.5% in January."
Shares in the group have rocketed from around 314p to 880p in the space of 12 months.
Ocado has signed a string of similar agreements in Europe and beyond, and is developing customer fulfilment centres with retailers in France, Canada and Sweden. In the UK, Ocado works with Morrisons.
Ocado continued to prove its selling power by signing Canada's Sobeys in January, and Sweden's ICA Group in May.
But these deals were only for one customer fulfilment centre.
Kroger has signed for up to 20 units, and Ocado may well extend the agreement in future.
"The others have been quite tentative, but Kroger has been quite courageous," said Anne Marie Neatham, chief operating officer of Ocado Technology. She has seen the company's technology arm grow from a workforce of 350 to over 1,200, and said the international deals work well for Ocado as it does not need to understand foreign markets intimately.