Online supermarket and tech firm Ocado has launched a £500 million bond to fund new warehouses and expansion into global markets, the company has announced.
Bosses said bondholders will receive between 0.75% and 1.25% interest per year and are set to be repaid in full in 2025.
Ocado said: “The net proceeds of the issue of the bonds will be used to fund capital expenditure in relation to Ocado Solutions’ commitments and general corporate purposes.”
In launching the bond, the company added that sales in the 13 weeks to December 1 are expected to grow between 10% and 11%.
But investors appeared uneasy at the plans to burden Ocado with debt, sending stock down more than 6% in early trading. Shares fell 80.5p to 1244.5p.
The company, which has struggled to make its UK grocery division profitable, has been having a more successful time selling its technology to overseas markets.
Last week, bosses revealed that they had signed a new partnership with Japan’s biggest supermarket group, Aeon, to help the grocer fight off competition from Amazon.
Previous deals have also been signed with Kroger in the United States and Casino in France, with both paying hefty sums for Ocado’s technology.
The grocery business in the UK is in the process of being transformed as part of a joint venture with Marks & Spencer, which will start offering its own groceries for home delivery via Ocado’s warehouses and technology next year.