In a significant shake-up in the global food delivery industry, US-based DoorDash has agreed to acquire British rival Deliveroo in an all-cash deal valued at £2.9 billion.
The offer, priced at 180p per share, marks the end of Deliveroo’s volatile tenure on the London Stock Exchange since its 2021 listing.
Deliveroo’s board approved the offer, which represents a premium to recent trading levels but values the business at less than half of its IPO valuation.
Deliveroo’s share price jumped at the announcement, and was trading 1.8% higher at 10:50 am London time.
DoorDash, headquartered in San Francisco, said the deal aligns with its strategy of global expansion and would not trigger competition concerns given the lack of overlap between the two companies’ geographic markets.
Deliveroo exits the London market after turbulent listing
Founded in 2013 by Will Shu and Greg Orlowski, Deliveroo once symbolised the high-growth potential of UK tech.
However, its market debut in March 2021 was marred by falling share prices, weak investor appetite, and mounting competitive pressure from rivals such as Uber Eats and Just Eat Takeaway.
Despite turning its first annual profit earlier this year, Deliveroo has struggled to sustain momentum, leading to speculation about a potential takeover.
The company operates in nine countries, while DoorDash has a presence in over 30, including the US, Canada, Australia, and New Zealand.
Shu, who still holds a 6.4% stake in the business, is set to earn £172.4 million from the transaction.
He called the agreement “the beginning of a transformative new chapter”, adding that both companies share a strategic vision to scale operations and enhance customer value.
Deal to support competitiveness in its markets: analysts
Analysts expect the deal to proceed without regulatory hurdles, given DoorDash’s absence in Deliveroo’s core markets.
Sean Kealy, analyst at Panmure Liberum, said Doordash’s intention to increase investment in Deliveroo indicated that the deal was designed to “support competitiveness in its markets.”
“[It’s] a clear indication that DoorDash is acquiring the business to accelerate its growth,” he said.
Jefferies analysts said the recommended final offer came “well ahead” of a May 23 deadline for DoorDash to make good on its initial proposal, “suggesting that the engagement to date had been more substantive than originally signalled”.
The transaction follows a trend of consolidation in the sector, exemplified by Prosus’s €4.1bn move to take Just Eat Takeaway private earlier this year.
Tony Xu, CEO of DoorDash, said the merger would combine the American group’s operational expertise with Deliveroo’s local market knowledge.
Both companies have recently expanded into grocery delivery and advertising services, areas seen as crucial for long-term profitability.
What is driving consolidation in the takeaway sector?
The DoorDash-Deliveroo tie-up is the latest in a series of consolidation moves sweeping through the global food delivery sector as companies grapple with cooling demand and tougher market dynamics.
Earlier this year, Prosus, the European investment arm of South Africa’s Naspers, agreed to a €4.1 billion deal to take Just Eat Takeaway — Europe’s largest food delivery platform — private.
The transaction marked a significant shift in the industry, underlining the growing pressure on public-market food delivery companies.
In the United States, GrubMarket, a $3.6 billion logistics and food delivery startup backed by heavyweights including Tiger Global and BlackRock, acquired FreshGoGo, a New York-based Asian grocery and meal delivery service.
The acquisition was part of GrubMarket’s broader consolidation strategy aimed at expanding its reach in the consumer-facing segment.
Uber also attempted to strengthen its regional presence by agreeing to buy Delivery Hero’s Foodpanda business in Taiwan last year.
However, the deal collapsed in early 2025 after Taiwan’s Fair Trade Commission blocked the transaction.
The regulator cited competition concerns, noting that a successful acquisition would have given Uber a near-90% market share in Taiwan’s food delivery sector, raising the risk of price hikes.
These deals come as the pandemic-fuelled boom in takeaway orders continues to lose steam.
The period between 2020 and 2021 saw a surge in delivery startups, many of which built sophisticated platforms connecting restaurants, delivery drivers, and end-customers.
Flush with venture capital, they aggressively competed for market share through promotions and discounts.
But by 2022, shifting consumer behaviour and broader economic pressures, including rising inflation and a slowing job market, started to erode growth in the sector.
Many companies began to experience stagnating revenues, and investors turned cautious as food delivery began to look more like a low-margin utility than a high-growth tech play.
As discretionary spending tightened and consumers returned to dining out, companies were forced to scale back, streamline operations, or seek mergers to stay competitive.
The result has been a steady consolidation of players, particularly in overlapping geographies.
The DoorDash acquisition of Deliveroo underscores this trend — a strategic response to muted growth expectations and a bet that greater scale can support long-term profitability through operational efficiencies and wider market access.
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