Ocado Group PLC (LSE:OCDO) shares continued to tumble on Friday, falling 5% and leading the FTSE 100 fallers, as it continues to suffer the fallout of its breakdown in partnership with M&S.
The grocery technology company said it may need to sue Marks and Spencer Group PLC (LSE:MKS) over a dispute that is preventing a payment to the online grocery specialist after their Ocado.com joint venture failed to meet performance targets.
Sophie Lund-Yates at Hargreaves Lansdown said: "There will be real concerns about what the cost of litigation could be for both parties – but more importantly, what the souring of relations means for the future of M&S food.
"The Ocado deal was a way for M&S to create an online footprint, with customers encouraged by the broad breadth of options available by the combination of Ocado.
"There will now be questions about who the next partner might be for Ocado, and that could leave somewhat of a hole in M&S’ food strategy."
Marks and Spencer shares are reacting better to the news, with shares holding flat on Friday after having dropped around 3% on Thursday.