Home delivery is proving popular among shoppers

Chief financial officer Jason Gissing said a stake bought by Goldman Sachs this year gave the company, which is part of John Lewis, a value of �300m.

He and his two co-founders said they expected the firm's value to increase significantly in the next 18 months.

The trio, former Goldman Sachs bankers, could make almost �100m from a float.

Extra funds

Together, Mr Gissing with chief executive Tim Steiner and director Jonathan Faiman, have a 27% stake in the business.

As well as US investment bank Goldman Sachs, other existing investors include department store chain John Lewis, Swiss investment bank UBS and Jorn Rausing, head of packaging group TetraPak.

We have always been clear from launch that we want to float the business Jason Gissing, Ocado chief financial officer

To date, Ocado has raised �150m from its backers.

A float would give investors a potential exit route and provide funds for further expansion.

John Lewis, which owns Waitrose, has a 43% stake in Ocado for which it paid �83m.

Any float would see the value of its stake rise. Alternatively, it could cash in part of its stake to raise cash.

"We have always been clear from launch that we want to float the business," said Mr Gissing.

"We hope to be in a position to look at broader financing options which will include a listing in approximately 18 months time - by which time we certainly hope to have created a significantly more valuable business."

Scope for growth

Ocado, which has been in business for less than three years, has annual sales of about �135m, according to the Financial Times.

The newspaper said Ocado reaches about 30% of British homes, but wants to extend its coverage to 70% over the next five years.

The online retailer does not offer the cheapest service but stocks upmarket brands like Prince Charles' Duchy Originals, delicatessen-style luxuries, and a wide range of organic products.

One popular feature is that clients are asked to choose a delivery time before they place an order online.

That way customers do not waste time ordering goods if the company is unable to deliver them when they are in.

The company said that following a successful launch of its service in North West England in October, it planned to expand to new areas in 2005.

This may require additional funding before the float goes ahead.