DoorDash offers to acquire Deliveroo for $3.6 billion in bold expansion into Europe

DoorDash is making another big move in Europe. The U.S.-based meal delivery company has set its sights on Deliveroo, offering $3.6 billion to acquire the British firm, per Reuters.

Deliveroo’s board said on Friday it reviewed the proposal, received on April 5, to buy all of its shares for £2.7 billion ($3.6 billion) — pricing them at 180 pence each — and would likely recommend the offer to shareholders if the two sides can finalize the remaining terms.

DoorDash has until May 23 to make a firm offer. A source familiar with the matter told Reuters that JPMorgan is advising DoorDash on the potential deal.

“Deliveroo announced that its board has reviewed DoorDash’s proposal of 180 pence per share and would likely recommend it to shareholders, contingent upon agreeing on the other terms of the offer,” Reuters reported.

The offer marks the first formal approach since reports last summer suggested DoorDash was interested in a takeover. Talks at that time reportedly fell apart over disagreements about valuation.

Deliveroo has struggled since its 2021 IPO, with shares tumbling nearly 50% as demand for online food delivery cooled after the pandemic boom. Investors have also shifted their focus to companies with stronger profitability. But in 2024, the Amazon-backed Deliveroo became profitable for the first time, posting a net profit of £1.3 million ($1.65 million) in the first half of this year, a major shift from the £82.9 million loss it suffered during the same period a year earlier.

The British company has been slimming down to stay competitive. In March, Deliveroo announced it was pulling out of Hong Kong, selling parts of its business there to foodpanda, a unit of Delivery Hero. The Hong Kong operations had been losing money and accounted for about 5% of Deliveroo’s total transaction volume.

Deliveroo’s stock closed at 146.6 pence on Friday, well below DoorDash’s offer price.

If the deal goes through, it’s expected to face little regulatory pushback. DoorDash would instantly gain access to 10 new markets where it currently has no presence, creating a much more complementary footprint compared to competitors who might trigger more antitrust concerns, a source said.

The move would also build on DoorDash’s growing international ambitions. In 2021, the company acquired Finland’s Wolt Enterprises in an all-stock deal valued at roughly $8 billion, setting the stage for a broader expansion across Europe.

Meanwhile, in late 2022, DoorDash laid off 1,250 corporate workers as part of the company’s push to stay afloat during a turbulent economy. The layoffs represented about 15% of the company’s total workforce. DoorDash had 8,600 corporate employees as of Dec. 31, 2021.