Ocado closes in on float after new Waitrose deal

The online grocer Ocado has signed a 10-year agreement with the supermarket Waitrose, boosting its chances of a £1bn flotation this summer. Ocado's existing contract with Waitrose was due to expire in 2013, but the agreement extends the supply relationship until 2020.

Ocado is now expected to appoint the investment banks UBS, Goldman Sachs and JPMorgan Cazenove as advisers on a flotation this summer. The new agreement will also enable Waitrose to grow its own home shopping service without restriction from July 2011 within the M25. Ocado sales rose by a quarter to £427.3m in 2009, but it has never made a pre-tax profit.