• DoorDash will acquire Deliveroo for about £2.9 billion ($3.9 billion).
• The deal aims to expand DoorDash's presence in European markets.
• Deliveroo's shares have struggled since their public listing in 2021.

DoorDash has confirmed its acquisition of the British meal delivery firm Deliveroo for approximately £2.9 billion ($3.9 billion). The deal, which was finalized on May 6, is part of DoorDash's strategy to expand its international markets and compete more effectively against rivals such as Just Eat and Uber Eats. The final offer values Deliveroo at 180 pence per share, a significant increase over its previous trading price but still well below its initial public offering price of 390 pence in April 2021, reflecting ongoing struggles in the meal delivery business, particularly post-pandemic, according to Reuters and Channel News Asia.

The acquisition is expected to enhance DoorDash's market position significantly, as it will add Deliveroo's established markets, notably in the UK where it has a 62% market share in meal deliveries. Collectively, Deliveroo and DoorDash handles orders worth about $90 billion annually, and this merger could create a strong competitive dynamic against existing partners in Europe, according to BBC and New York Times.

This move comes amidst concerns regarding the trend of UK firms being acquired by U.S. companies, as analysts speculate the potential for reduced investment attractiveness in the London Stock Exchange. Deliveroo co-founder Will Shu expressed pride in the company’s achievements but acknowledged that this acquisition could have transformative benefits for growth and resource investment, according to Bloomberg and Channel News Asia.

DoorDash emphasized that it has secured support from shareholders holding 15.4% of Deliveroo shares, including key investors, which is crucial for the deal’s approval. The acquisition is not expected to encounter regulatory hurdles, as DoorDash's presence in Deliveroo's primary markets is minimal, ensuring a smoother pathway to completion later this year, according to Reuters and BBC.