Grubhub is denying rumors that the food delivery startup is on the chopping block or considering an acquisition, triggering a 6.7 percent drop in share prices, according to reports on Thursday (Jan. 9).
“We felt it was important to clarify that there is unequivocally no process in place to sell the company and there are currently no plans to do so,” a Grubhub spokesperson said in a statement to CNBC. “We have always consulted advisers about a broad range of issues, including potential acquisition opportunities — that has not changed.”
Executives from Walmart, Kroger, Albertsons and Ahold-Delhaize were said to be pondering an acquisition of the Chicago-based Grubhub, the New York Post (NYP) reported earlier. The Wall Street Journal cited unnamed sources claiming that the firm was considering strategic options as competition in the food delivery space intensifies.
“I have spoken with executives from each company (especially Walmart), and there is interest in acquiring Grubhub,” ex-Amazon executive and supply-chain consultant Brittain Ladd told NYP in an email. “I believe the value of Grubhub to Walmart is that they could leverage Grubhub for delivering food and groceries.” Ladd indicated he spoke with Walmart insiders about the possible purchase in December.
Grubhub said it has a policy not to comment on rumors but felt that given the considerable media speculation yesterday, it was important to clarify the current lack of plans to sell and released a statement to that effect.
When Grubhub was founded in 2004, it was a pioneer in the sector, going public almost six years ago. It has since been joined by Uber Eats, DoorDash, Postmates and others. Grubhub’s $4.5 billion valuation is down from a high of $13 billion last year.
At the end of October, the company slashed profit forecasts and revenue, blaming the issue on slow customer growth.
The delivery space is in a “weird bubble that is about to burst,” Grubhub Chief Executive Matt Maloney recently said.