LONDON (Reuters) – Britain’s Ocado Group said on Wednesday it had secured its first deal outside of grocery retail, providing its robotic warehouse technology to a site of drug distributor McKesson Corp’s Canada unit.
Shares in Ocado were up 7% in late afternoon trading after the online supermarket and technology group announced the deal.
CEO Tim Steiner said Ocado’s technology was ideally suited to supply chains that required dense storage, highly accurate inventory management and secure stock control.
“It has been proven over 20 years in one of the most complex supply chain environments, online grocery, and we’re now bringing our experience and IP to more sectors,” he said.
Ocado said it will receive upfront fees during the construction process with the final payment upon final installation. It will also receive an ongoing annual fee related to the servicing and maintenance of the technology.
Ocado said the impact of the deal will be minimal on cash flow and earnings in its current financial year.
(Reporting by Prerna Bedi in Bengaluru and James Davey in London; Editing by Shilpi Majumdar, Kirsten Donovan)
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