Online retailer Ocado has revealed plans to raise £575 million to help fund its growth plans.
he FTSE 100 company said after the markets closed on Monday that it will raise the cash injection through a placing of new shares.
It said it has also agreed a £300 million revolving credit facility, provided by a syndicate of international banks.
The fundraising comes after a drop in Ocado’s share price, which has seen its value cut by around half over the past six months as customers returned to pre-pandemic shopping habits.
Ocado told investors on Monday afternoon that members of its leadership team, including CEO Tim Steiner, will buy new shares as part of the placing.
“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 commented.
It said funding will be used to support growth in its Ocado Solutions business, which provides automated warehouse technology for retail partners.
The group said it needs to invest in the solutions business as rising online grocery demand global means its partners need to grow their fulfilment capacity.
Ocado said it will also be able to invest in technology innovation faster.
The group also held firm on its previous trading guidance for the current financial year.