British meal delivery company Deliveroo announced it had received a takeover proposal from U.S.-based DoorDash on April 5, offering to buy all of its shares for 2.7 billion pounds, equivalent to approximately $3.60 billion. Deliveroo’s board has reviewed DoorDash’s offer of 180 pence per share and stated it would likely recommend the proposal to shareholders, provided that both parties can agree on the final terms of the deal. DoorDash has until May 23 to make a formal offer. JPMorgan is advising DoorDash on the transaction, according to a source familiar with the matter.
This offer represents the first formal approach since initial reports surfaced during the summer of last year. Deliveroo’s stock has struggled significantly since its 2021 market debut, falling nearly 50% as the boom in online food delivery that surged during the pandemic has cooled, and investors have shifted their focus toward more consistently profitable companies. In March, Deliveroo exited the Hong Kong market, selling some assets to Delivery Hero’s foodpanda after determining that operations in Hong Kong, which accounted for about 5% of its overall transactions, were persistently loss-making.
As of Friday, Deliveroo’s shares closed at 146.6 pence, below the offer price of 180 pence per share, highlighting the premium DoorDash is willing to pay. According to sources, the proposed acquisition is expected to encounter minimal regulatory obstacles, as it would give DoorDash access to ten new markets where it currently has no presence, thereby creating a complementary geographic footprint. In contrast, other potential competitors might face greater antitrust scrutiny.
Last year, DoorDash had also expressed interest in acquiring Deliveroo, but those talks ultimately fell apart due to disagreements over valuation. A successful acquisition would strengthen DoorDash’s position in Europe, following its 2021 all-stock purchase of Finnish delivery company Wolt Enterprises, a deal valued at about $8 billion.
The potential merger between DoorDash and Deliveroo would mark a significant strategic move for DoorDash, allowing it to expand rapidly across Europe and better compete against established rivals in the region. Investors and analysts are watching closely as both companies work to finalize discussions in the coming weeks. The outcome of these negotiations could reshape the competitive landscape of the food delivery industry across multiple markets.
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