London (AFP) – US delivery service DoorDash has agreed to take over UK peer Deliveroo in a deal worth £2.9 billion ($3.9 billion), according to a joint statement on Tuesday. DoorDash said it would pay £1.80 per share for Deliveroo, which has exited several markets in recent years due to increased competition.
The combined group “will bring together DoorDash’s strong operating playbook with Deliveroo’s local expertise to invest in innovation and execution at an even higher level,” DoorDash chief executive Tony Xu said in a statement. The deal will give the combined food delivery service a presence in over 40 countries, serving around 50 million monthly active users.
London-listed Deliveroo only posted its first annual profit in March following sizeable full-year losses owing to high investment costs since American Will Shu founded the company in 2013. It experienced a surge in demand during the Covid-19 pandemic from lockdown-hit customers, but increased competition has since led it to scale back global operations. Most recently, Deliveroo exited Hong Kong amid growing competition in the Chinese city, following its exit from Australia and the Netherlands.
The deal is expected to be completed in the last three months of 2025, subject to regulatory approval and the approval of Deliveroo shareholders. It marks the latest deal in the food delivery market, after Dutch investment group Prosus announced plans in February to buy Just Eat Takeaway.com for 4.1 billion euros.
© 2024 AFP
