Ocado Group PLC shares dropped on Thursday as the firm said it will, alongside Sobeys Inc, focus their joint resources into driving order and sales volumes across the current network instead of proceeding with plans for a new ’fulfilment centre’.
Ocado shares fell 15% to 300.80 pence each in London on Thursday afternoon.
The Hertfordshire, England-based grocery retailer and technology firm partnered with Sobeys, Canada’s second largest food retailer, in January 2018.
Both companies agreed to launch an online grocery business in Canada using the end-to-end solutions within the Ocado Smart Platform.
On Thursday, Ocado noted a pause to the planned go-live of Sobeys fourth fulfilment centre in Vancouver, Canada, originally planned for 2025.
Ocado also said that it and Sobeys have agreed to end terms related to mutual exclusivity.
‘Ocado and Sobeys have decided for now to focus their joint resources into driving order and sales volumes across the current network. This currently comprises 3 live CFCs in major Canadian markets, across Toronto, Montreal, and Calgary, and manual fulfilment solutions in nearly 100 stores,’ Ocado said.
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