DoorDash to buy British food delivery firm Deliveroo for $3.9 billion in overseas push

A Deliveroo courier was spotted near Victoria station in London, England, on March 31, 2021.

British food delivery company Deliveroo announced on Tuesday that it has accepted a takeover bid from its American competitor DoorDash, valuing the company at £2.9 billion ($3.9 billion). Deliveroo’s board approved DoorDash’s offer to purchase all existing and future shares at 180 pence per share, representing a 44% premium over Deliveroo’s closing price on April 4. Deliveroo’s shares surged to a three-year high last week following confirmation of the takeover bid from DoorDash.

This deal signifies the end of a challenging period for Deliveroo as a publicly traded firm. Initially hailed as a British tech success story, Deliveroo faced a significant drop in its stock price following its lackluster debut on the London Stock Exchange. The company’s shares have continued to decline and are now more than 50% below its IPO price of £3.90.

DoorDash’s acquisition of Deliveroo reflects its strategic move to expand internationally, following its purchase of Finnish food delivery app Wolt for 7 billion euros ($7.9 billion) in 2022. Despite this positive development, DoorDash’s shares experienced a slight dip in U.S. pre-market trading on Tuesday in response to the news of the Deliveroo acquisition.

The food delivery industry has been witnessing a trend of consolidation in recent years, with companies like Deliveroo and Just Eat making strategic moves to adapt to the evolving market landscape.