DoorDash mentioned on Tuesday it has agreed to purchase its U.Okay. rival Deliveroo for about £2.9 billion (round $3.29 billion), because the U.S. meals supply firm seeks to increase into new markets.

DoorDash pays Deliveroo shareholders 180 pence per share, which represents a premium of 44% over the latter’s share worth on 4 April, when the U.S. agency approached with its acquisition supply, the businesses mentioned.

The deal would give DoorDash entry to 9 new markets in Europe, the place Deliveroo operates in primarily. The businesses are betting their mixed scale would additionally assist them compete higher with rivals comparable to Simply Eat Takeaway and Uber Eats.

DoorDash mentioned it will function in 40 international locations and serve a complete of fifty million month-to-month energetic customers as soon as the acquisition closes.

Based in 2013, Deliveroo went public in 2021, when the grocery and meals supply sector was using excessive on post-pandemic tailwinds — individuals had been nonetheless making an attempt to remain dwelling, work remotely, and so had been ordering takeout greater than they might have in any other case. Meals and grocery supply startups had been being based in droves and attracting piles of enterprise capital.

However as COVID fears pale and other people returned to procuring in-person and going out to eating places and cafes, meals and grocery supply startups instantly discovered themselves struggling to regulate to quickly altering shopper conduct in a instantly crowded house. It didn’t assist that capital began rising scarce in 2022 as rates of interest rose and enterprise traders held on to their checks as they sought extra worthwhile investments.

Since its itemizing, Deliveroo’s shares had declined greater than 50% till April 4. This March, the corporate sold its Hong Kong business to Delivery Hero, citing intense competitors. It had additionally exited Australia in 2022, the place it confronted related competitors pressures.

Deliveroo reported income of about £2 billion and gross transaction worth of £7.1 billion within the yr ended December 2024.