Dutch grocer Royal Ahold agreed to boost online supermarket Peapod's credit limit from $20 million to $50 million, Peapod said Wednesday. Last week, Peapod, the Web's second largest grocer, behind Webvan, reported its biggest quarterly loss yet and warned that it would run out of cash by the end of the year without additional financing.
Royal Ahold, which took a controlling interest in the then almost-insolvent Peapod last April, has since supported the Web grocer by supplying it with cash and credit. Peapod said that with the new credit line, it will have enough to see it through until the end of the year. To help reduce its costs, Peapod has decided to discontinue operations in San Francisco. Paula Wheeler, a Peapod spokeswoman, said the company expects to show a profit at two of its distribution centers by the middle of this year.
