Amazon Extends U.K. Grocery Alliance With Retailer Morrison

(Bloomberg) -- Amazon.com Inc. is expanding its alliance with U.K. retailer Wm Morrison Supermarkets Plc to offer groceries in more cities across the country, putting more pressure on supermarkets to expand online.

The companies plan to introduce Prime Now same-day delivery service to cities including Glasgow, Scotland, and Liverpool, England, this year, Morrison said Thursday. Morrison shares rose as much as 2.9% in London, the most since January.

Grocers have been competing for an edge in the U.K. e-commerce market since Amazon first formed its alliance with Morrison, the smallest of the U.K.’s main grocery chains, three years ago. In February, Marks & Spencer Group Plc agreed to buy half of online grocer Ocado Group Plc’s U.K. business for 750 million pounds ($951 million). Amazon also led a $575 million funding round at London-based food delivery service Deliveroo, which is preparing to spread across the U.K.

“Morrisons at Amazon” is currently available in four cities, where many customers can receive groceries within one hour of ordering. The service will also enter the English cities of Newcastle, Sheffield and Portsmouth this year, and further locations in coming years.

Morrison loosened a six-year-old pact with Ocado last month so that it could expand more with other partners.

(Updates with shares in second paragraph.)

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