DoorDash, the largest food delivery app in the US, has initiated formal talks to acquire Deliveroo, one of Europe’s leading delivery platforms, in a deal valued at approximately £2.7 billion ($3.6 billion), according to a report by the Financial Times.
Deliveroo’s shares surged by 17% following the announcement, potentially earning its founder, Will Shu, around £172 million based on his 5.9% stake in the company.
Deliveroo, which saw significant growth during the COVID-19 pandemic due to a boom in food delivery, has struggled to maintain sustainable profitability despite recording its first annual pre-tax profit of £12.2 million in 2024, on revenues of £2.07 billion.
DoorDash, currently commanding about 65% of the US delivery market, is aiming to expand its footprint across Europe, continuing its international growth strategy through acquisitions, following its 2022 purchase of Finnish firm Wolt.
However, Deliveroo emphasized to its shareholders that there is “no certainty that a firm offer will be made” and advised them to take no action yet. Under City takeover rules, DoorDash has until 5 pm on May 23 to present a firm offer.
Analysts suggest that if completed, this acquisition could trigger a wave of consolidation, forcing smaller players out of the market and leading to a sharp rise in customer acquisition costs by 2026, amid an industry shift from “growth at any cost” to profitability and operational efficiency.
