DoorDash in Advanced Talks to Acquire Instacart for $17 Billion
The potential deal comes as delivery companies seek growth beyond their core services amidst industry challenges.
DoorDash is reportedly in advanced negotiations to acquire its delivery rival Instacart, with a potential deal valuing the grocery-delivery platform at approximately $17 billion. The source familiar with the matter indicated to Reuters that an agreement could be finalized as early as Wednesday, though the outcome remains uncertain.
Instacart's previous discussions with Uber regarding a potential acquisition are no longer active, according to the source.
Following the report, Instacart's shares saw an increase of about 8% in regular trading. As of Friday's close, the company held a market value of roughly $13 billion. DoorDash's stock experienced a decline of approximately 6%.
The food delivery industry has faced increasing pressures, including rising labor costs, stricter regulations concerning delivery workers, and a slowdown after the surge in online ordering during the pandemic.
This potential acquisition aligns with a broader trend of delivery companies expanding into grocery and retail sectors to diversify revenue streams beyond traditional restaurant delivery. Both DoorDash and Uber have previously engaged in acquisitions to bolster their market positions, with DoorDash acquiring Deliveroo and Uber purchasing Postmates and Delivery Hero.
If the acquisition proceeds, DoorDash would gain access to Instacart's established marketplace and its relationships with retailers, which could be integrated with DoorDash's extensive delivery infrastructure and customer base.
Earlier reports indicated that Instacart had been exploring a potential sale and had engaged in preliminary talks with various potential buyers, including Uber and DoorDash.
In a separate development, Instacart announced in a regulatory filing that it would discontinue its Caper Cart smart shopping-cart business by the end of the second quarter of 2027. The company anticipates pre-tax charges between $55 million and $80 million related to this decision.
Instacart declined to comment on the acquisition talks, while Uber and DoorDash have not yet responded to requests for comment.