Food delivery service Deliveroo surges following $3.6B proposed takeover offer from DoorDash

Shares of Deliveroo, the food delivery service based in London, are hitting three-year highs on Monday after it received a $3.6 billion proposed takeover offer from DoorDash

ByMICHELLE CHAPMAN AP business writer

Shares of Deliveroo, the food delivery service based in London, are hitting three-year highs on Monday after it received a $3.6 billion proposed takeover offer from DoorDash.

Deliveroo announced the bid after markets closed in Europe on Friday. On Monday, the company also said that it was suspending a $133.5 million share buyback it had announced last month.

Deliveroo said Friday that its board has informed DoorDash that if a firm offer is made at the financial terms provided, it will recommend the bid to its shareholders.

Deliveroo added that its board has decided to engage in talks with DoorDash about the possible offer and has given the company access to due diligence.

Deliveroo said DoorDash must decide by May 23 whether it plans to make a firm buyout offer or not.

The proposed deal comes a few months after technology investment company Prosus agreed to buy food delivery giant Just Eat Takeaway.com for 4.1 billion euros ($4.29 billion). Acquiring Just Eat Takeaway.com will boost Prosus’ food delivery portfolio in Europe, a move that DoorDash is also looking to make.

DoorDash currently runs its business in the U.S., Canada, New Zealand and Australia.

Deliveroo, which was founded in 2013, operates in 10 markets worldwide, including the U.K., Italy and France. The company reported its first annual profit last year.

In January 2024 Delivery Hero sold its minority stake in Deliveroo after holding it for less than three years. The two companies worked together earlier this year, with Delivery Hero buying some of Deliveroo’s Hong Kong assets after the company decided to exit that market.

Ronald Josey of Citi Investment Research can see a few reasons why DoorDash is interested in Deliveroo.

“While we continue to believe that DoorDash is more focused on organic expansion, Deliveroo meets several of DoorDash’s merger and acquisition criteria, including expanding geographies and total addressable market whereby it would take DoorDash time to do organically while delivering long-term free cash flow,” he wrote.

Shares of Deliveroo jumped more than 17% on the London Stock Exchange on Monday.

Sponsored Content by Taboola

Read More

  • Related Posts

    Postal service plans to open last-mile delivery network to more shippers in money-raising move

    This page either does not exist or is currently unavailable. From here you can either hit the “back” button on your browser to return to the previous page, or visit…

    Calls for service of thanksgiving for last Battle of Britain pilot John ‘Paddy’ Hemingway and other heroes of ‘The Few’ after his death aged 105 as Prince William leads moving tributes

    There are calls for a special national service to honour Battle of Britain pilots after the last surviving member of ‘The Few’ died. The Prince of Wales led tributes to…

    You Missed

    NATO chief warns war with Russia ‘is at our door’ and tells Europe to be ready for action ‘now’ to avoid battle on scale ‘our grandparents and great-grandparents endured’

    NATO chief warns war with Russia ‘is at our door’ and tells Europe to be ready for action ‘now’ to avoid battle on scale ‘our grandparents and great-grandparents endured’

    Charlie Kirk shooting suspect Tyler Robinson makes first public appearance since murder… and his mom bursts into tears at the sight of him

    Charlie Kirk shooting suspect Tyler Robinson makes first public appearance since murder… and his mom bursts into tears at the sight of him

    Zelensky says the people of Ukraine will have to vote on handing land over to Russia in any US peace proposal

    Zelensky says the people of Ukraine will have to vote on handing land over to Russia in any US peace proposal

    Billionaire heir’s horrific final moments caught on camera after he led cops on chase to his $2.8m hunting lodge during marriage drama… then strutted out front door holding a gun

    Billionaire heir’s horrific final moments caught on camera after he led cops on chase to his $2.8m hunting lodge during marriage drama… then strutted out front door holding a gun

    Plans to ban new petrol cars in the EU have been abandoned in hasty u-turn from European lawmakers

    Plans to ban new petrol cars in the EU have been abandoned in hasty u-turn from European lawmakers

    Family say grandmother’s death after catching Legionnaires’ disease from ‘smelly and off-colour’ hot tub in rented holiday cottage was ‘entirely preventable’

    Family say grandmother’s death after catching Legionnaires’ disease from ‘smelly and off-colour’ hot tub in rented holiday cottage was ‘entirely preventable’