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Ocado shares rocket on Kroger tech deal

Shares in online grocer Ocado have surged by nearly 50% after it struck a deal with US retail giant Kroger.

Ocado's technology will be used in the US exclusively by Kroger, which is one of the world's biggest grocery chains with annual sales of $122bn (£90bn).

Under the terms of the deal, Kroger will also take a 5% stake in Ocado.

The agreement is the latest in a series of deals that Ocado has struck with retailers to share its technology that automates online grocery orders,

The Kroger deal is the fourth agreement Ocado has reached in six months, and marks its first foray into the US.

Shares in Ocado rose 47% to 814p in early trade in London.

Ocado and Kroger are already looking to identify the first three sites for automated warehouse facilities in the US, and are aiming for up to 20 sites over the first three years of the agreement.

Ocado chief executive Tim Steiner said: "As we work through the terms of the services agreement with Kroger in the coming months, we will be preparing the business for a transformative relationship which will reshape the food retailing industry in the US in the years to come."

http://www.bbc.com/news/business-44151028