From Rivals to Partners: DoorDash Acquires Deliveroo in a £2.9 Billion Deal

The food delivery industry has become a battleground for innovation, competition, and consolidation in recent years, as companies race to capture a larger share of a booming market. With demand for convenience-driven services at an all-time high, the push to expand geographically, enhance technological capabilities, and diversify offerings has intensified. Amid these trends, major players are reshaping the industry landscape through high-profile mergers and acquisitions, aiming to secure their dominance in an increasingly globalized market.

In this context, DoorDash, the U.S. market leader in food delivery, has taken a bold step with its recent ‘DoorDash acquires Deliveroo’ move for £2.9 billion. This acquisition marks a significant milestone in the industry’s ongoing consolidation, combining the strengths of two influential platforms to solidify DoorDash’s position in the lucrative European market. The deal not only expands DoorDash’s reach but also underscores its commitment to becoming a truly global player in food delivery.

Adding to its ambitious expansion, DoorDash has also announced plans to acquire SevenRooms, a hospitality software company based in New York, for $1.2 billion. With this dual move, DoorDash demonstrates a forward-thinking strategy aimed at diversifying its services, enhancing technological integration, and staying ahead of evolving consumer and business demands. Together, these acquisitions highlight DoorDash’s vision to redefine the future of food delivery and hospitality in an increasingly competitive global landscape.

DoorDash: A Global Leader in Food Delivery

Founded in 2013 by four Stanford students—Tony Xu, Stanley Tang, Andy Fang, and Evan Moore—DoorDash has become a dominant force in the global food delivery market. The team shared a vision of leveraging technology to bridge the gap between local restaurants and customers, offering a seamless delivery experience while empowering small businesses. Each founder brought unique expertise to the venture, contributing to its rapid rise in a highly competitive industry.

Tony Xu, the CEO, drew inspiration from his immigrant background and his mother’s entrepreneurial journey running restaurants and acupuncture clinics. His leadership has been instrumental in scaling the company globally. Stanley Tang and Andy Fang, both technology enthusiasts, spearheaded the design and development of DoorDash’s platform, ensuring it was efficient and scalable. Evan Moore played a vital role in shaping the company’s strategic direction during its formative years, laying the groundwork for its operational success. The founders’ hands-on approach, which included making deliveries themselves in the early days, exemplified their commitment to the business.

Under their leadership, DoorDash has achieved remarkable milestones. By 2024, the company operated in over 30 countries, serving approximately 42 million active users monthly—a 5 million user increase over the previous year. DoorDash processed 2.58 billion orders in 2024, reflecting nearly 20% growth compared to 2023, while gross order value reached $80.1 billion, marking a 19.9% year-over-year increase. Revenue grew by 24.2% to approximately $10.7 billion, underscoring the company’s strong financial performance.

In the United States, DoorDash commands a 67% market share, cementing its position as the leading food delivery service. The company has diversified its offerings beyond restaurant delivery, venturing into convenience and grocery sectors to meet growing consumer demand for comprehensive delivery solutions. Its subscription services, DashPass and Wolt+, have attracted over 22 million members combined, enhancing customer retention and order frequency.

DoorDash’s market capitalization has surged to approximately $93 billion as of May 2025, significantly outpacing competitors like Deliveroo. Since its IPO in 2020, the company’s share value has increased by 84%, reflecting investor confidence in its growth trajectory. Strategic acquisitions, such as the 2021 purchase of Helsinki-based Wolt and the recent £2.9 billion acquisition of Deliveroo, have strengthened its global footprint. Together, DoorDash and Deliveroo generate a combined gross order value of roughly $90 billion.

The company’s website engagement metrics further emphasize its market dominance, with 71.6 million visits and an average session duration of over seven minutes, signaling strong user interest and platform loyalty. DoorDash’s innovative approach, driven by the collective efforts of its founding team, has positioned it as a leader in the fast-evolving and competitive food delivery industry.

Deliveroo: Revolutionizing Food Delivery

Founded in London in 2013 by Will Shu and Greg Orlowski, Deliveroo was born out of Shu’s frustration with the limited and low-quality food delivery options in London compared to his hometown of New York. Shu, a Taiwanese-American former investment banker, had relocated to London and experienced firsthand the city’s lack of convenient, high-quality restaurant delivery services. Motivated to address this gap, he partnered with Orlowski, a skilled software engineer, to create a platform that would redefine food delivery. Their mission was to bring “proper food, proper delivery” to customers by partnering with a diverse range of restaurants, including many that did not traditionally offer takeaway services.

In its early days, Deliveroo operated with just a handful of restaurants, and Shu personally made deliveries as the company’s first rider. This hands-on approach helped build a business model focused on speed, quality, and convenience. With an average delivery time of 32 minutes, Deliveroo quickly gained popularity among customers seeking high-quality restaurant meals delivered efficiently. The platform benefited customers with greater choice and convenience, increased restaurant revenues by 30% or more through access to new customer segments, and offered flexible, well-paid work opportunities for its riders. Deliveroo’s rapid growth was fueled by approximately $200 million in funding from prominent investors such as Accel and Index Ventures, enabling expansion both within the UK and internationally.

Today, Deliveroo is headquartered in London, directly employs over 300 people, and operates a network of approximately 130,000 riders across its markets. The company serves 13 countries and 54 cities, maintaining a strong presence in the UK and Ireland, which account for 62% of its total order value. Key cities include London, Manchester, Birmingham, Edinburgh, Dublin, Cork, and Galway. Deliveroo has also established significant operations in France, Italy, and select parts of Asia and the Middle East, further cementing its position as a global player in the food delivery sector.

Financially, Deliveroo reported sales of approximately £2 billion in 2024. The company went public in 2021 with an IPO price of 390 pence per share, capitalizing on a pandemic-driven surge in food delivery demand. However, since its IPO, Deliveroo’s shares have declined by around 56%, reflecting challenges such as heightened competition, shifting consumer habits post-pandemic, and investor concerns about profitability. Despite these setbacks, Deliveroo continues to innovate, offering services such as Deliveroo Plus, a subscription providing unlimited free deliveries, and expanding its restaurant and delivery network to stay competitive.

Deal Structure and Financial Overview

DoorDash has agreed to acquire Deliveroo in a definitive all-cash transaction valued at approximately £2.9 billion ($3.85–$3.9 billion). Under the terms of the agreement, Deliveroo shareholders will receive 180 pence per share—representing a 44% premium over the company’s closing share price on April 4.

The acquisition will be executed through a UK Court-sanctioned Scheme of Arrangement, which requires the approval of at least 75% of shareholders by value. Notably, major shareholders and board members representing 15.4% of the company’s equity have already committed their support to the deal.

While the offer delivers a substantial premium to recent trading levels, it remains below Deliveroo’s IPO valuation, underscoring the company’s underperformance since going public. Despite this, key stakeholders—including founder and CEO Will Shu—stand to receive sizable payouts, though these are tempered by the broader decline in Deliveroo’s market capitalization and competitive positioning.

Strategic Rationale Behind the DoorDash Acquires Deliveroo Deal

DoorDash’s acquisition of Deliveroo for approximately £2.9 billion ($3.85–$3.9 billion) is a strategic move designed to significantly expand its global footprint and enhance its competitive position in the increasingly consolidated food delivery market. DoorDash, while dominant in the U.S., has had limited presence in Europe and the Middle East. Acquiring Deliveroo-which operates primarily in the UK, Ireland, France, Italy, and several other countries-provides DoorDash immediate access to nine new markets and a well-established logistics network, including Deliveroo’s extensive rider base and merchant relationships, especially in dense urban centers. This expanded scale is crucial for DoorDash to effectively compete with major rivals such as Just Eat Takeaway and Uber Eats, who already have strong European operations.

From Deliveroo’s perspective, the deal offers a timely opportunity to navigate post-IPO challenges. Since its 2021 public offering at 390 pence per share, Deliveroo’s stock has declined by over 50%, reflecting profitability pressures, increased competition, and shifting consumer behavior as pandemic-driven demand normalized. Deliveroo’s leadership views the acquisition as a chance to leverage DoorDash’s operational expertise, technology, and financial resources to accelerate innovation, improve efficiency, and enhance the overall customer and merchant experience. Deliveroo’s Independent Committee unanimously endorsed the offer, highlighting the benefits to shareholders and other stakeholders.

The broader industry context also supports this consolidation. Rising inflation and tighter household budgets have made consumers more selective about spending on food delivery, pressuring companies to achieve greater scale and operational efficiency. Analysts widely agree that only the most resilient and well-capitalized firms will thrive in the long term, making mergers like this a logical evolution in the sector.

Global Impact and Market Reach

The combined entity will operate in over 40 countries and serve approximately 50 million monthly active users, creating one of the world’s largest food delivery platforms. In 2024, DoorDash and Deliveroo together processed orders with a gross value of about $90 billion, underscoring the scale and economic significance of the merger. This expanded reach positions DoorDash as a formidable rival to Just Eat and Uber Eats, particularly in Europe, where Deliveroo’s strong urban presence complements DoorDash’s strengths in suburban and rural markets. The acquisition is expected to “shake up” the UK and European markets by offering enhanced service options and competitive pricing.

Operational and Technological Synergies

The merger offers significant operational and technological synergies. DoorDash’s technology-driven platform, known for its data analytics and efficient delivery algorithms, will integrate with Deliveroo’s last-mile logistics expertise and deep local market knowledge. This combination is expected to improve delivery speed, reliability, and customer satisfaction. DoorDash has committed to investing further in product development, technology innovation, and enhancing the consumer experience by leveraging Deliveroo’s operational progress. The deal also aims to create new growth opportunities for merchants by expanding their reach and for delivery riders by improving work conditions and earning potential through a larger, more efficient platform.

Challenges and Considerations

Despite the strategic benefits, the acquisition faces several challenges. Regulatory approval is a key hurdle, with antitrust authorities in the UK and the European Union closely scrutinizing the deal to ensure it does not reduce competition or harm consumers. There are also national concerns in the UK about major tech firms being acquired by U.S. companies, raising questions about local investment and economic sovereignty. Additionally, the success of the merger depends heavily on the seamless integration of the two companies’ operations, cultures, and technologies. Maintaining strong merchant partnerships and managing competition responses will be critical to realizing the deal’s full potential.

Stakeholder Reactions

DoorDash CEO Tony Xu expressed enthusiasm about the acquisition, highlighting the complementary strengths of the two companies and the potential to invest in innovation and improve consumer retention. Deliveroo’s CEO Will Shu emphasized the shared strategic vision and values, anticipating that the combined company will better serve merchants, riders, and communities. Industry analysts view the acquisition as a necessary response to sector pressures, with consolidation seen as essential for long-term viability. Following the announcement, Deliveroo’s stock rose about 2%, though it remained below the offer price, reflecting cautious investor sentiment amid ongoing market uncertainties.

Strategic Implications and Future Outlook

DoorDash’s £2.9 billion acquisition of Deliveroo represents a transformative milestone in the global food delivery industry. By combining their strengths, the two companies will create a powerhouse operating in over 40 countries, serving 50 million users, and processing $90 billion in annual orders. While the deal offers substantial strategic and operational advantages, its ultimate success will depend on regulatory approval, effective integration, and the ability to deliver sustained value to shareholders, merchants, consumers, and delivery riders in a rapidly evolving and competitive market. This acquisition underscores the ongoing consolidation trend in food delivery as companies seek scale, efficiency, and innovation to meet changing consumer demands.