DoorDash to Acquire Deliveroo in $3.85 Billion Deal

U.S.-based food delivery giant DoorDash is set to acquire British rival Deliveroo in a deal valued at approximately £2.9 billion ($3.85 billion), the companies announced Tuesday, marking a significant consolidation in the global meal delivery industry. The move underscores DoorDash’s strategy to broaden its international presence and strengthen its position in the increasingly competitive European market, according to Reuters.

The agreement, which prices Deliveroo shares at 180 pence each, represents a premium over the company’s recent trading price, though the stock remained slightly below the offer level at 176.40 pence following the announcement. Deliveroo’s shares have declined markedly since their public debut at 390 pence in 2021—a period when pandemic lockdowns drove a surge in demand for delivery services, per Reuters.

In tandem with the Deliveroo deal, DoorDash also revealed plans to acquire SevenRooms, a hospitality-focused software company headquartered in New York City. That separate transaction, valued at around $1.2 billion, further illustrates DoorDash’s ambition to diversify and deepen its foothold within the broader restaurant and hospitality ecosystem.

Related: DoorDash Proposes $3.6 Billion Acquisition of Deliveroo

This double acquisition push comes as the food delivery sector faces growing pressure to consolidate. With consumer spending tightening and operational costs rising, many firms have struggled to scale profitably. “There were too many companies chasing the same opportunity and that’s unsustainable,” noted Russ Mould, investment director at AJ Bell, emphasizing the industry’s shift toward consolidation as only the most resilient players emerge as long-term contenders.

The purchase of Deliveroo positions DoorDash to better challenge entrenched European competitors such as Just Eat and Uber Eats. Deliveroo’s operations in the UK and Ireland, its largest markets, are expected to provide DoorDash with a critical boost in regional market share. According to Reuters, the deal had been under renewed discussion since last month, when DoorDash formally approached Deliveroo with its offer, now confirmed as final.

“In addition to having the foundation in which we can add scale to our investments in Europe, we have the possibility to introduce new products to the market,” DoorDash CEO Tony Xu said during a post-earnings call.

Source: Reuters