Doordash is making another big move in Europe. The US-based meal delivery company has set its sights on Reardoo, offering $3.6 billion per Reuters to acquire British companies.
Derveroo’s board of directors said on Friday it would consider the proposals it received on April 5th and would buy all the shares for £2.7 billion ($3.6 billion).
Doordash must make solid offers until May 23rd. A source familiar with the matter told Reuters that JpMorgan is advising Doordash on potential deals.
“Deliveroo announced that its board would consider a Doordash proposal of 180p per share and would likely recommend it to shareholders, subject to the agreement of other terms of the offer,” Reuters reported.
The offer marks the first formal approach since last summer’s report suggested Doordash was interested in the acquisition. The discussions at the time reportedly collapsed over differences in opinion over the assessment.
Derriboroo has been struggling since the 2021 IPO, with stocks falling nearly 50% as demand for online food delivery cooled after the pandemic boom. Investors have also shifted their focus to highly profitable companies. However, in 2024, Amazon-backed Deliveroo made its profit for the first time, recording a net profit of £1.3 million ($1.65 million) in the first half of this year.
The UK company is slimmer to stay competitive. In March, Derveroo announced that it had withdrawn from Hong Kong and was selling some of its business to Foodpanda, a delivery hero unit. Hong Kong’s business was losing money, accounting for around 5% of Deliveroo’s total trading volume.
On Friday, well below the Doordash offer price, Dearroo shares closed at 146.6p.
If a transaction is made, it is expected that there will be little regulatory pushback. Doordash will instantly access 10 new markets that currently lack a presence, creating a much more complementary footprint compared to competitors that could raise more antitrust concerns, sources said.
The move is also based on Doordash’s growing international ambitions. In 2021, the company acquired Finland’s Wolt Enterprises with a total stock deal of approximately $8 billion, setting the stage for a wider expansion across Europe.
Meanwhile, in the second half of 2022, Doordash fired 1,250 corporate workers as part of pushing for what the company is floating during the turbulent economy. Layoffs accounted for about 15% of the company’s total workforce. Doordash had 8,600 corporate employees as of December 31, 2021.
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