Ocado is rare British tech success story but could a predator be poised to strike?

Ocado boss Tim Steiner opened his full year results by declaring the business to be “an 18-year overnight success”.

That may be pushing it a bit, but Steiner could be forgiven his hyperbole. For a long time the online grocer was the recipient of more rotten tomatoes than an Adam Sandler movie.

Sceptics regularly took bets on when then thing would fall over.

To be fair, this was partly fuelled by the company continually promising a trolley full of deals to sell its whizzy proprietary tech that never materialised.

More recently those deals are proving to be like London buses. After an interminable wait, they have all come along at once, and from here, there and everywhere.

M&S is the latest company to be linked to the outfit, with reports of talks about a potential tie up lighting more fires under some of the stock market’s hottest shares.

M&S, of course, doesn’t do food deliveries, and it’s a rather glaring lack in the retailer’s portfolio.

Cynics have, however, noted that those reports coincide with the impending end of the Ocado’s supply deal with Waitrose.

Even though products co-branded with the latter represent only 10 per cent of its range, they are an important part of the overall offer. M&S would appear to represent a more than adequate replacement were one needed, or a more than adequate means of motivating Waitrose to continue the arrangement.

CEO Tim Steiner presented a straight bat when questioned by analysts on the subject, as one might expect.

The market was notably relaxed about the rest of what he had to say, not to mention the thumping loss the group reported.

The £45m deficit was largely created by the company’s investing in kit such as its robot run warehouses and its partnerships.

Shareholders seem minded to allow Ocado to lose as much as it needs to for those purposes. Growth is worth paying for, and Ocado is producing it.

Its revenues are expanding at a handy clip and it's generating the sort of excitement more normally found among tech companies. But that's what Ocado is. It's just one with a grocer on top.

Is its success sufficient to attract a predator? There was a time when Ocado could have been picked up for a song, but that’s no longer the case.

It is a rare British tech success, made even more unusual by the fact that it has been developed on the public markets, which have only belatedly learned to love it.

However, if a no deal Brexit causes a flight from British assets, as it likely will, the shares could start to look cheap again. The ugly nationalists pursuing that lunatic project could very well usher this British success into foreign hands.