March 13 Britain's fourth-largest grocer, WM Morrison Supermarkets, is in talks about a strategic partnership with Ocado Group Plc that would use the online grocer's warehouse capacity and technological expertise, Sky News reported on Wednesday.
Sky News reported that the talks about a potential joint venture have been going on for a while although an announcement on Thursday was unlikely.
A spokesman for Morrisons declined to comment on the report. Ocado could not be reached outside office hours.
Under the deal, Morrison's would pay to use part of Ocado's new distribution centre in Dordon, north Warwickshire, and would utilize Ocado's technological expertise to build its own customer-facing website, Sky News said.
Sky News said that Morrisons online strategy was not reliant on a deal with an external partner such as Ocado.
The Bradford northern England-based Morrisons has been losing out to the other so-called big four supermarket rivals Tesco , Wal-Mart's Asda and Sainsbury partly due to the absence of an online grocery business.
The company is expected to launch an online food platform when it reports its full-year results on Thursday.