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Ocado has vowed to use “all available means” to force Marks & Spencer to hand over a £190m payment linked to their online joint venture.
The British technology company issued the threat as part of a brewing legal battle with M&S, which has so far resisted calls to hand over the cash after the pair’s online grocery partnership failed to hit performance targets.
The payment is meant to be binary, meaning that either Ocado receives the full payment or nothing. However, Ocado claims that factors such as the Covid pandemic should be taken into account when considering its performance. M&S has rejected this.
Ocado this week said it believed it had a “strong negotiating position” to achieve a satisfactory settlement, with the pair still in “constructive discussions”.
However, it said that if an agreement could not be reached, it would “look to use all contractual or legal means” to secure the payout.
It comes more than a year after Ocado threatened to take legal action over the payment.
Tim Steiner, Ocado’s chief executive, refused to be drawn on the specifics of the negotiations but said: “We’re both very excited about the growth prospects for the business and how it’s performed over the last year and any kind of matters like [the final instalment], we can discuss in private.”
Ocado has previously said it expected to receive £28m from M&S, although it is still holding out for more.
In Thursday’s results, Mr Steiner said Ocado had written this down to zero but added that this was purely a conservative accounting decision.
He said this was “not a reflection of ongoing conversations with our colleagues and partners at M&S on the resolution of the final payment”.
The comments came as Ocado revealed it was planning further job cuts as part of a drive to reduce costs and make the business profitable.
The company racked up a pre-tax loss of £375m for its latest financial year, compared to a £393.6m loss a year earlier.
The results sent shares in Ocado plunging by almost 13pc, with the company trading around 90pc lower than it was at the height of the pandemic in 2021.
Ocado said it would scale back teams in its research and development department, saying it no longer needed to spend so heavily on technology development.
Ocado said the number of redundancies would be “significantly” less than the 1,000 job cuts it made last year.
Mr Steiner said: “It’s not a fun position to be in, but we are coming to the end of the cycle.”