Marks and Spencer Group PLC (LSE:MKS) is adamant it does not need to make a final payment to Ocado Group PLC (LSE:OCDO) for its share in the two’s joint venture into online groceries.
Stuart Machin, M&S’s CEO, defended his company’s stance following the release of the group’s annual results.
"On the contingent payment the performance target is binary and it was dependent on ORL (Ocado Retail Limited) meeting a specified level of earnings in the financial year and actually those earnings and that performance was not met,” Machin said.
Ocado Retail, the joint venture in question, has been at the front of a dispute between the two listed retailers since February.
Ocado Group had threatened to sue M&S as it said it deserved the performance-based target of £191 million due in August.
Back in February, Ocado Group admitted that the joint venture had performed below the targets required for the bonus.
However, it claimed “significant decisions and actions" had been made by Ocado Retail’s management which meant the target should be tweaked and the payment should be provided.
Machin added: “For us it's pretty clear, we continue to write the accounting value (of the payment) as zero.
"We're working very well with Ocado Retail.”