DoorDash strikes $17B deal for rival Instacart in bets on grocery delivery
A major grocery delivery deal
DoorDash announced Thursday that it would purchase Instacart for roughly $17 billion. The acquisition would strengthen DoorDash’s position in the growing U.S. grocery delivery business. The offer is $65 per Instacart share. That represents a premium of about 26% over the closing price on October 22, before news of discussions about a deal surfaced.
Instacart’s online grocery experience
DoorDash co-founder and CEO Tony Xu pointed to the difficulty of selling groceries online. He said Instacart had spent years developing its ability to serve grocers. The proposed combination comes as app-based delivery platforms face intensifying competition. The article describes grocery delivery as a fast-growing market in the United States.
Industry pressures and timing
Delivery companies are contending with slower order growth after pandemic-era peaks, higher costs and regulatory scrutiny of gig-worker treatment. Those pressures have helped prompt a wave of deals across the industry.
The DoorDash-Instacart transaction is projected to close at the end of 2027 or during the first half of 2028. The announcement did not give a more specific closing date.
Key points
- DoorDash plans to acquire Instacart in a deal valued at about $17 billion.
- The offer is $65 per Instacart share, about 26% above its October 22 closing price.
- DoorDash CEO Tony Xu highlighted Instacart’s experience selling groceries online.
- The deal is expected to close in late 2027 or the first half of 2028.