Ocado reveals £1bn valuation target

The firm said shares will be priced at between 200p and 275p each as it prepares to publish its prospectus and launch an investor roadshow ahead of a flotation later this month.

Ocado employees and customers who have spent more than 300 with the company so far this year will have until the end of July 18 to take part in a shares offer.

The listing, which is expected to earn Ocado a place in the FTSE 250 Index, is set to net paper fortunes for its founders - three former Goldman Sachs bankers Tim Steiner, Jason Gissing and Jonathan Faiman - and management, who between them own 13.3 per cent of the business.

Ocado wants to raise 200m by selling new shares as part of the initial public offering to help expand its distribution centre and build a second warehouse.

But the firm, which delivers Waitrose food, has never made a profit since launch more than 10 years ago.

Around 15 top bosses at Ocado are to take part in a share ownership scheme, which could reportedly pay out 30m within four years if they double the share price.

They are expected to invest around 1 million of their own money into the scheme - said to be similar to that run by clothing retailers such as Next and ASOS.

A successful life on the stock market could also benefit other major shareholders, such as the John Lewis company pension scheme, which owns around 25 per cent of Ocado.

Today's pricing range would value the group at between 800m and 1.1m without the new shares taken into account.

Including the new shares and at the mid-point of the price range, Ocado's market worth is expected at 1.18bn.

Another 36 per cent is owned by banks such as Goldman Sachs, UBS and Lloyds Banking Group.

The group now has 1.6 million registered customers and 4,300 employees at eight different sites.

It recently signed an exclusive 10 year deal with Waitrose and wants to increase its 14 per cent share of the burgeoning online grocery market with more initiatives.

It has launched its Ocado own label range and expanded product ranges to more than 20,000, while it is also developing new customer offerings such as the Ocado on the Go iPhone ordering service.

Interim results for the 24 weeks to May 16 also unveiled today showed revenues up 29 per cent to 230m, with weekly orders passing 100,000 for the first time in early May. The group also cut operating losses by 63 per cent to 2.7m.

But its plan could come under pressure amid stiff competition from supermarket rivals, while exclusive partner Waitrose is also understood to be working on plans to launch a competing delivery operation in central London within two years.