Online retailer Ocado said it managed to hit a fundraising target of more than half a billion pounds that it plans to push into its growth plans.
The business succeeded in raising £575 million from shareholders, a target announced on Monday afternoon, by selling them new shares.
It also managed to get another £3 million from its senior management, including chief executive Tim Steiner and the firm’s finance boss, who both took advantage of the cut-price shares.
The net proceeds of the capital raise is expected to give the company enough liquidity to fund the requirements of its existing and expected customer commitments into the mid-term, driving strong growth and returns in the futureOcado
The FTSE 100 firm had announced the move on Monday after the markets closed.
It has also agreed a loan facility with several international banks which will let it borrow up to £300 million.
“The net proceeds of the capital raise is expected to give the company enough liquidity to fund the requirements of its existing and expected customer commitments into the mid-term, driving strong growth and returns in the future,” the firm said.
It comes as Ocado’s share price dropped by around half in just the past six months. Customers flocked to the online supermarket during lockdown, but many are now returning to old habits.
The new money will be funnelled away from the supermarket business itself and invested in the technology arm of Ocado.
Ocado Solutions, as it is called, sells automated warehouse technology to other retailers around the world.
Rising demand for groceries has seen its customers needing help to increase the number of orders they can deliver, Ocado said.
It also hopes to invest in more innovation with the cash. Financial guidance for the year remained unchanged.