DoorDash to Acquire UK-Based Rival Deliveroo in $3.9 Billion Deal

DoorDash, the well-known U.S.-based food delivery platform, has reached an agreement to acquire its British competitor Deliveroo in a cash deal valued at 2.9 billion pounds (USD 3.9 billion). The move marks a significant expansion for DoorDash into Europe, Asia, and the Middle East, extending its global footprint well beyond its core markets of the U.S., Canada, and Australia.

As per the agreement, DoorDash will pay 180 pence (USD 2.40) per Deliveroo share, which is 29% higher than Deliveroo’s closing share price on April 24—the day before the deal was made public. The announcement was made jointly by both companies prior to the opening of the London Stock Exchange on Tuesday.

This acquisition is DoorDash’s second major international expansion within three years. In 2022, the San Francisco-based company acquired Helsinki-headquartered Wolt Enterprises. With the inclusion of Deliveroo, DoorDash will now operate in over 40 markets globally, significantly enhancing its competitive position in the international food delivery landscape.

DoorDash CEO Tony Xu expressed enthusiasm about the acquisition, stating, “I could not be more excited by the prospect of what DoorDash and Deliveroo will be able to accomplish together.” Both DoorDash and Deliveroo were founded in 2013 and have since utilized mobile smartphone technology to efficiently connect customers with a network of delivery personnel, revolutionizing how food is ordered and delivered.

Deliveroo, which has established a strong presence in nine countries, generates the majority of its revenue from the United Kingdom and Ireland—these two markets contributed 59% of its total business in 2023. Aside from the UK and Ireland, Deliveroo operates in France, Italy, Belgium, Singapore, the United Arab Emirates, Kuwait, and Qatar. The company’s extensive geographical presence makes it an attractive acquisition target for DoorDash, which is aiming to become a dominant player in global food delivery services.

This acquisition also comes at a time of heightened activity in the food delivery sector. Less than three months ago, Dutch-based tech investment firm Prosus reached an agreement to acquire Just Eat Takeaway.com, headquartered in Amsterdam, for 4.1 billion euros (USD 4.29 billion). That deal is expected to significantly bolster Prosus’s portfolio in the European food delivery market.

DoorDash’s acquisition of Deliveroo reflects the ongoing consolidation and fierce competition within the global food delivery industry. As companies seek to scale and diversify their operations, strategic acquisitions are becoming a preferred method for rapid international growth. With Deliveroo under its wing, DoorDash will be better equipped to compete with other global giants and respond to evolving market demands across diverse regions.

In conclusion, the DoorDash–Deliveroo deal is a landmark moment in the global food delivery business. By combining their technologies, networks, and market presence, the two companies aim to deliver more value to customers and restaurants alike while shaping the future of food delivery on a global scale.