Deliberations between Uber and German food delivery platform Delivery Hero over a potential takeover are ongoing and there is no certainty they will lead to a deal, according to people familiar with the matter, as the US ride-hailing company explores a transaction that could reshape the global food delivery market.
Uber confirmed over the weekend that it had offered €33 per share for Berlin-based Delivery Hero, valuing the company at about €10bn. Investors quickly dismissed the proposal as too low, with some pushing for closer to €40 per share. Delivery Hero’s board said it remained focused on its strategic review, leaving open the possibility of rival bids.
On Monday 25 May, Delivery Hero’s shares surged more than 10% in Frankfurt trading, hitting an 18 month high, closing at €37.16, well above Uber’s indicative price. The rally reflected investor expectations that Uber would need to raise its bid to secure control. The Uber board met on Saturday to consider an improved offer after a €38 per share proposal was rejected by a major shareholder.
Uber has already built its stake in Delivery Hero to nearly 20%, making it the largest shareholder, but any further move would likely require antitrust clearance. Shares in Uber fell 2.4% in New York following the news, reflecting investor concerns over the cost of consolidation.
The attempted takeover comes amid a wave of consolidation in the food delivery sector. DoorDash acquired Deliveroo last year, while Prosus moved on Just Eat Takeaway. Delivery Hero itself has faced pressure from activist investors to streamline its portfolio, with its Middle East unit Talabat attracting interest from rivals.
Any deal is likely to face scrutiny from regulators given Uber’s expanding footprint in delivery markets worldwide.
