Dive Brief:

• Ocado has agreed to purchase robotics technology startup Myrmex in a move intended to improve order-handling efficiency at automated fulfillment centers developed by the U.K.-based grocery e-commerce company, the companies announced in a press release Monday.
• Ocado, which has held an unspecified minority stake in Myrmex since late 2020, plans to pay approximately 10.2 million euros ($10.9 million) to take full control of the firm. The transaction is expected to close by June 6.
• Technology developed by Myrmex is playing a central role as Ocado looks to enhance the robot-driven order-handling systems it provides to Kroger and other grocers.

Dive Insight:

Ocado’s interest in owning Myrmex stems from the robotics startup’s development of a system to move containers holding assembled grocery orders onto delivery equipment, which the e-commerce company says reduces labor costs and improves employee productivity.

Ocado hired Myrmex to design and develop a process to automate the order-loading process in its customer fulfillment centers (CFCs) in October 2020, when it initially invested in the company. The technique, which Ocado calls “automated frameload,” is among a host of improvements to the Ocado Smart Platform the company introduced during a media event in January.

The acquisition will allow Ocado to bring capabilities developed by Myrmex to CFCs around the world and also provide opportunities for the development of other unspecified automation techniques, according to the announcement.

In addition to speeding up operations at automated warehouses, capabilities developed by Myrmex also have the potential to automate order-pickup processes at grocery stores, the press release noted.

Ocado indicated that it was pleased with how quickly Myrmex built the automated frameload system, which it said the company delivered in just over a year.

“This acquisition is another important step on our automation journey and provides an opportunity to further grow and expand our engineering presence in Southern Europe as we continue to invest in developing Myrmex’s technologies for the Ocado Smart Platform,” Ocado Technology Chief Engineering Officer James Gralton said in a statement.

Ocado will absorb Myrmex’s team of more than 30 workers skilled in automaton hardware and software, who will join Ocado’s workforce of about 2,500 technologists. Founded in the United States in 2015, Myrmex has an office in Fremont, California, and bases its research-and-development activities in Athens, Greece.