LONDON (Reuters) - British online grocer Ocado is close to appointing advisers for an initial public offering which could value the company at about between 1.0 billion pounds and 1.2 billion, a person familiar with the matter said on Sunday.
Any flotation would likely take place in the second quarter of 2010, the person said.
Ocado declined to comment.
Ocado, which sells food sourced from supermarket operator Waitrose (part of John Lewis), is expected to appoint three investment banks, with Goldman Sachs, UBS and JP Morgan Cazenove seen as frontrunners to lead the float, according to the Sunday Times.
The company is expected to raise about 160 million pounds from the flotation, the paper added.
Last month Ocado reported a 30 percent rise in underlying sales during December to 40.8 million pounds, with demand fuelled by a 30 percent increase in the number of items it sells to 21,000, including its discount Everyday range.
The Ocado flotation will be another test of investor demand for new stock offerings in Europe, where volatility in financial markets has lately dampened interest in IPOs, leading to several deals falling through in recent weeks.
Ocado, whose delivery vans decorated with large pictures of fruit and vegetables are a common sight in many affluent British suburbs, may have to work hard to convince investors of its appeal given market uncertainties and the weak economic outlook.
Such factors have already led to Belgian chemical company Taminco withdrawing its flotation, the UK's Pets at Home opting for a trade sale rather than an IPO and Helikos in Germany raising a below-target 200 million euros ($277.5 million).
So far this year Europe has registered three major IPOs raising a combined $3.1 billion, almost 40 percent of last year's total of $7.9 billion, according to Thomson Reuters data. But some bankers say it may prove difficult to reach the $40 billion which some had expected this year.
(Reporting by Lorraine Turner; Editing by David Holmes)
($1=.6363 Pound)
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