Morrisons will start its online groceries business by the end of 2013 after unveiling a tie-up with Ocado. The launch will see Morrisons use Ocado's new distribution centre in Warwickshire for deliveries using a Morrisons-liveried fleet. The 25-year deal involves Morrisons paying up to £170 million to Ocado to acquire the site and equipment. The customer gets affordable fresh food delivered by Ocado's distribution system. With the addition of planned new capacity, the Ocado site at Dordon, Warwickshire, will be able to handle up to 190,000 orders a week at its peak. About half of this will be available to Ocado. The company will initially pay Ocado up to £170 million to acquire Dordon and associated handling equipment as well as a licence and integration fee. A further £46 million will be invested to expand Dordon to accommodate the Morrisons range, link it to Morrisons' systems and establish a delivery network.

Ocado Group PLC announced that the company has entered into a 25 year agreement with Morrisons to license certain technology, logistics and distribution services to enable Morrisons to launch and develop its online grocery business.

To discuss Ocado Group PLC’s agreement with Morrison Supermarkets plc to license certain technology, logistics and distribution services to enable Morrisons to launch and develop its online grocery business