In a move to expand its international footprint, U.S.-based meal delivery platform DoorDash (NASDAQ: DASH) has announced its agreement to acquire Deliveroo (LSE: ROO), the leading food delivery service in the UK, in a deal valued at approximately $3.9 billion (£2.9 billion).
The acquisition, set to further consolidate the competitive food delivery market, will see Deliveroo shareholders receiving 180 pence per share in cash.
The acquisition is part of DoorDash’s strategy to broaden its reach and capabilities across Europe, particularly in the highly competitive UK and Ireland markets, where Deliveroo has a dominant presence. The deal, which represents a premium of 44% over Deliveroo’s closing price on April 4, 2025, is expected to enhance DoorDash’s position as a global leader in local commerce, delivering a stronger product offering for businesses, consumers, and couriers alike.
Acquisition Terms and Strategic Vision
The final offer of 180 pence per Deliveroo share has been unanimously recommended by Deliveroo’s Independent Committee, marking the culmination of ongoing discussions between the two companies. DoorDash, which already operates in over 30 countries, views the acquisition as an opportunity to enhance its operational scale and customer value proposition in Europe.
DoorDash’s CEO, Tony Xu, expressed his excitement about the partnership, stating, “We are deeply committed to growing and empowering local economies. Deliveroo shares our vision of supporting consumers, merchants, and riders. By combining our forces, we will reach more than 1 billion people in over 40 countries, furthering our mission to connect local businesses with the communities they serve.”
The agreement also highlights the companies’ shared dedication to customer-centric innovation. Xu emphasized that the merger would enable both companies to invest more in technology and new services, ensuring enhanced experiences for consumers and providing growth opportunities for local merchants and couriers.
A Strategic Fit for DoorDash and Deliveroo
Deliveroo’s founder and CEO, Will Shu, noted that the acquisition marks a pivotal moment in the company’s journey. “We’ve always been focused on delivering value to our consumers, and this acquisition will accelerate that mission. Together, DoorDash and Deliveroo are perfectly positioned to serve the evolving needs of local communities.”
Shu also reflected on Deliveroo’s achievements as an independent company, particularly its impact on transforming food delivery in the UK and other global markets. He emphasized the complementary nature of the two companies, which operate in different but strategically aligned geographies, with DoorDash strong in North America and Deliveroo leading in the UK, Ireland, and parts of Europe and the Middle East.
Deliveroo’s Chair, Claudia Arney, further endorsed the merger, commenting, “The decision to recommend this offer was made after careful consideration, recognizing the benefits to our shareholders and stakeholders. This combination will strengthen our competitive advantage and position us for future growth.”
The Path Forward: Integration and Expansion
The acquisition is expected to be completed without significant regulatory hurdles, given DoorDash’s limited presence in the markets where Deliveroo operates. The deal is still subject to approval by at least 75% of Deliveroo’s shareholders.
Once finalized, the combined entity will have access to a broader consumer base, serving approximately 50 million monthly active users across its expanded geographic reach. Together, DoorDash and Deliveroo are expected to generate a Gross Order Value of about $90 billion in 2024, a figure that highlights the enormous potential of their merged operations.
According to analysts, the global food delivery sector is ripe for further consolidation as companies strive to scale up and reduce costs in an increasingly competitive environment. Inflation and changing consumer spending patterns have made it difficult for smaller players to survive without the backing of larger, more diversified companies. By acquiring Deliveroo, DoorDash is positioning itself as one of the dominant players in the global market, competing against other heavyweights such as Just Eat and Uber Eats.
Financial Details and Shareholder Support
Under the terms of the acquisition, DoorDash will pay 180 pence per share in cash, which delivers a significant premium to Deliveroo’s recent stock price. The deal has garnered support from investors holding 15.4% of Deliveroo’s shares, including Will Shu, who will receive 172.4 million pounds for his 6.4% stake.
Deliveroo’s shares have experienced volatility since their IPO in 2021, which was priced at 390 pence. However, the final offer from DoorDash represents a strong exit for investors, especially considering the current market environment and the challenges facing the food delivery sector.
While DoorDash has ruled out raising the offer, the company has retained the option to do so if a competing bid emerges. Notably, Amazon, which owns a 14.38% stake in Deliveroo, has yet to comment on the deal, and analysts speculate that the e-commerce giant could still emerge as a potential counter-bidder.
DoorDash’s Broader Expansion Strategy
In addition to acquiring Deliveroo, DoorDash has announced plans to purchase SevenRooms, a New York-based hospitality software company, for $1.2 billion. The acquisition of SevenRooms is expected to bolster DoorDash’s platform, enhancing its capabilities in the restaurant and hospitality sectors.
DoorDash’s strong execution and product innovation have allowed it to establish leadership in the U.S. market, and the company’s expansion into European and Middle Eastern markets has proven successful. The acquisition of Deliveroo, combined with the purchase of SevenRooms, positions DoorDash to continue its rapid growth and extend its dominance in local commerce globally.
To dive deeper into the ongoing shifts in the European food delivery landscape and understand why Deliveroo and Just Eat Takeaway are drawing more investor interest compared to Delivery Hero, be sure to check out my detailed analysis on why these two companies are getting acquisition offers while Delivery Hero isn’t. You can read it here.
