Morrisons is to expand its home delivery service nationwide after agreeing a new deal with its online partner, Ocado.

The Yorkshire-headquartered supermarket’s online business is currently available to about half of UK households and excludes the South West and Scotland.

The new deal, which which will allow Morrisons to serve online shoppers from its stores as well as Ocado’s central warehouse in Warwickshire, comes after Ocado agreed to develop a new IT system.

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It will also deliver thousands more non-food items not currently offered on Morrisons’ website.

Morrisons chief executive David Potts said: “The new investments in online growth are further examples of Morrisons building a broader business and will allow millions more customers all over Britain to enjoy Morrisons’ good-quality fresh food and great value for money.”

The new terms will also see Morrisons halve the amount it pays towards Ocado’s research and development, to £4m a year from 2018, and it will no longer pay a 25% cut of any future profits from its online business for the next 15 years.

The supermarket has in return agreed to help fund 30% of the costs of developing Ocado’s new distribution centre in south London, which is due to open in 2018.

It has also allowed the online specialist to run branded online services for other retailers – with the exception of its major competitors Tesco, Sainsbury’s, Asda, Aldi and Lidl.