Amazon has declined to comment on a report that it is considering a bid for UK online supermarket Ocado. The Times newspaper reported on Thursday that Amazon was in early-stage talks about a potential acquisition, but Amazon has not confirmed or denied the rumors.
Ocado’s shares surged over 40% on Thursday morning after the report. However, they have since retraced some of those gains. The company’s market capitalization currently stands at approximately £9 billion.
A deal between Amazon and Ocado would be a major coup for Amazon. Amazon has been looking to expand its grocery delivery business in the UK. Ocado has a leading position in the UK online grocery market. Its automated warehouses are seen as a valuable asset.
There are potential challenges to an Amazon-Ocado deal. The UK’s Competition and Markets Authority would scrutinize it, possibly facing antitrust challenges.
It’s uncertain if Amazon will formally offer for Ocado. The rumors already affected Ocado’s share price. They may result in a bidding war between Amazon and other suitors.
