DoorDash announced plans to acquire Instacart in a deal valued at $17 billion on Thursday morning. Instacart is a grocery delivery company that helps customers order groceries from local stores.
DoorDash is mainly known for delivering restaurant food . Instacart’s board of directors has unanimously approved the deal. The deal could also create more earning opportunities for local business owners.
DoorDash will pay $65 per Instacart share under the deal. This is 26% more than Instacart’s closing share price on October 22, according to Yahoo Finance. The deal will include 75% cash. DoorDash shares rose more than 5% in premarket trading after the announcement. Instacart already has nearly 100,000 stores on its platform.
The acquisition will help the company expand its grocery delivery business and bring more local stores onto its platform, according to the companies’ announcement. Instacart shareholders will be able to choose cash, DoorDash shares, or a combination of both, according to the company’s press release. This means all the board members supported the proposed acquisition, according to the press release. Xu said the two companies could work together to give stores of all sizes better tools for online delivery. He also said the deal could help unlock more opportunities in the grocery delivery market, according to the press release. Instacart shares moved slightly lower during the same period, according to Yahoo Finance. Adding more stores through the DoorDash deal would expand the choices available to customers, according to the companies’ press release. The companies said the combined business would give local stores more ways to reach customers and earn money through delivery services, according to the press release.
