Consolidation in delivery services: DoorDash buys Deliveroo for billions

The US food delivery service DoorDash wants to take over its British competitor Deliveroo for 2.9 billion British pounds (3.4 billion euros). The boards of directors of both companies have agreed on the deal, DoorDash announced on Tuesday. The takeover price represents a premium of 44 percent on the share price on April 4, the day before the takeover negotiations began. Deliveroo went public in 2021, where the share price initially rose slightly before beginning to fall in 2022. After an issue price of 3.4 euros per share, the price then leveled off at around half that level until it rose slightly once again before the takeover.

More and more consolidation

Deliveroo, headquartered in London, was founded in 2013 and is currently still active in the UK, France, Belgium, Ireland, Italy, Singapore, Kuwait, Qatar and the United Arab Emirates. The delivery service withdrew from Germany in 2019 after Lieferando acquired several German competitors. The British company then ceased operations in Taiwan, Spain, the Netherlands, Australia and Hong Kong. In light of the takeover, co-founder Will Shu now assures that he is proud of what has been achieved and that in DoorDash they have found a partner who shares their goals and values.

As the Financial Times explains, the focus of DoorDash itself has so far been on the USA, Canada, Australia and New Zealand. As there is no overlap with the markets in which Deliveroo is active, it is assumed at both company headquarters that competition authorities will not stand in the way of the deal. However, DoorDash already acquired Wolt at the end of 2021; the competitor has been expanding for years, particularly in Central Europe, and has also been active in Germany since 2020. However, there is no overlap here either. The takeover is a further indication that companies active in the delivery services market are increasingly focusing on size, writes the British newspaper.

(mho)