The Ocado Group has gone on a shopping spree this fall by both: making investments in and acquiring several robotics technology companies. The Ocado Group is the technology division of Ocado, an online supermarket, that offers curb side pick up or delivery of groceries. Ocado does not offer an in-store shopping experience, and has seen growth in their business during the pandemic. Ocado is based in Britain, and is a publicly traded company on the London Stock Exchange. These strategic investments should help Ocado with their expansion plans worldwide, across a variety of markets, both small and large. As a result, the company as recently raised it’s profit projections.
A Minority Stake in Myrmex
On October 15th, 2020, the Ocado Group announced that it acquired a minority stake in retail fulfillment vendor Myrmex. Ocado Group has secured intellectual property that is synergistic with its pioneering suite of solutions and has appointed Myrmex to design and develop a bespoke product. Ocado Group also has the option to participate in future finance offerings. Myrmex Inc. is a materials handling robotics start-up with a unique offering including autonomous mobile robots and intelligent asset handling systems. Myrmex’s suite of solutions notably enables click-and-collect deliveries, allowing the industry to respond to the accelerated demand for smart deliveries created by the Covid-19 pandemic.
Myrmex could be considered a competitor to Ocado for the fulfillment technology, although Myrmex is not in the online grocery sales side of the business. They offer a complete turnkey curbside delivery solution for existing online grocers to offer an automated click-and-carry fulfillment option. Myrmex is covered in the recent Warehouse Solutions Buyers Guide (by the Mobile Robot Guide) in the automated storage and retrieval section.
George Katiniotis, Chief Executive Officer of Myrmex stated: “With over 20 years of experience in transforming online grocery through cutting-edge technology and automation, Ocado Group is widely recognized as the leader in this space. The company’s investment is testament to Myrmex’s robotics and automation capabilities and will enable us to accelerate the commercialization of our product portfolio.”
Alex Harvey, Engineering Director for OSP Handling Robotics at Ocado Technology said: “We’ve been impressed with Myrmex’s capabilities and are excited about the potential synergies with our existing business. As the shift to online grocery accelerates, we are moving even faster in adding automation to our end-to-end offering. Myrmex can play a part in that journey.”
Acquisition of Kindred Systems and Haddington Dynamics
On November 2, 2020 the Ocado Group announced that is has acquired San Francisco based Kindred Systems, for $292 million in cash. Ocado also announced the acquisition of Las Vegas based Haddington Dynamics for $25M in cash and stock. Kindred Systems has a proven robotic picking and manipulation solution with 180 robots expected to be deployed by the end of 2020. Haddington Dynamics’ technology offers specialized robotic arm characteristics that are well-suited to grocery using novel, low cost designs.
Both acquisitions are expected to complete before the end of 2020.
“We have been investing in autonomous robots and picking for a decade,” says James Matthews, CEO of Ocado’s technology division, which builds the systems that Ocado’s own grocery business uses, as well as the tech it sells to other grocers through its Ocado Smart Platform. “This is about how we invest more to do more, more quickly.”
Ocado said that the acquisitions would add about $38 million in revenue to its annual revenues, which last year were about $2.3 billion. The company said the acquisitions would make a small dent in its profits, but overall it raised its full year profit forecast to $77.8 million, up from $52 million. Ocado’s shares, which are listed on the London Stock Exchange, jumped 7% in response.