Uber Secures USD 14.8 Billion Delivery Hero Acquisition, Expanding Global Reach
- tech360.tv
- Jul 17
- 3 min read
Uber has agreed to acquire Germany's Delivery Hero for an equity value of USD 14.8 billion. This transaction aims to establish the largest food delivery group outside of China, intensifying competition against US and European rivals. The acquisition expands Uber's global food delivery business, consolidating market presence.
The deal, according to a Delivery Hero statement, will result in a combined platform spanning 99 countries, boasting a pro-forma gross merchandise value of USD 236 billion in 2025. Dara Khosrowshahi, Uber's chief executive, stated the merger would almost double the markets offering both mobility and delivery services. Uber, already Delivery Hero's primary shareholder, conditioned the acquisition on a minimum acceptance threshold of 50 per cent plus one share. The offer represents a roughly 34 per cent premium to Delivery Hero's three-month volume-weighted average share price and 9 per cent above its previous closing price.
But the transaction is expected to face a complex regulatory process, particularly concerning antitrust scrutiny due to overlapping operations. To mitigate these concerns, Delivery Hero will divest operations in 14 markets to the US investment firm SSW Partners for approximately USD 1.605 billion. And major shareholder Prosus has committed to selling its nearly 17 per cent stake, limiting potential for a rival bid. Jefferies analysts noted the anticipated completion timeline, set for the second half of the following year, suggests a protracted review.
The commitments made by Prosus to the European Commission, a condition for securing approval for its acquisition of Just Eat Takeaway, facilitated Uber's bid. These regulatory requirements obliged the Dutch technology investor to reduce its 26.5 per cent stake in Delivery Hero, according to individuals familiar with the matter. One such individual characterised Prosus as a "false seller", implying the sale was a regulatory necessity rather than a strategic choice. This remedy allows a US company to take control of one of Europe's largest food delivery groups, despite expressed intentions to foster European tech organisations.
The food delivery market outside of China has seen significant consolidation, shifting from a fragmented landscape during the pandemic to a highly concentrated market. This was driven by a slowdown in order volumes from peak pandemic levels and mounting pressure to enhance profit margins. Simultaneously, increasing regulatory oversight exists regarding the employment conditions of gig workers. This environment prompted acquisitions, including Uber buying Postmates, DoorDash acquiring Wolt and Deliveroo, and Just Eat merging with Takeaway.com and purchasing Grubhub. Delivery Hero itself expanded through deals for Glovo and foodpanda.
So, this latest transaction positions Uber and DoorDash as the dominant players in the global food delivery sector. Excluding overlapping markets, Uber's food delivery network will expand from 50 to 99 markets. This brings a business with approximately USD 42 billion in gross bookings from the previous year into Uber's portfolio. Delivery Hero had previously rejected an earlier Uber approach that valued it at approximately USD 11.465 billion, or USD 37.83 a share. And following anticipation of an improved offer, Delivery Hero shares approached USD 41.27 in subsequent weeks, with the stock currently up 62 per cent this year.
Kristin Skogen Lund, Delivery Hero's supervisory board chair, stated that "joining forces with a strong partner now is the right move for Delivery Hero to best secure its future competitiveness," citing the crucial role of scale in a competitive industry. Founded in Berlin in 2011, Delivery Hero expanded rapidly through acquisitions, though it has since scaled back from certain markets to focus on profitability. Uber has committed to investing USD 2.293 billion in Germany through 2031 and has agreed to maintain Delivery Hero's Berlin headquarters and workforce until at least 2029.
Adam Ballantyne, an analyst at Cambiar Investors, a firm that holds Uber shares, noted that the deal provides Uber with access to roughly 60 million monthly active users. These users are predominantly in markets where Uber previously maintained a limited presence. He suggested that these new countries could provide years of additional organic growth for Uber as the company integrates its rides and eats services, extending its Uber One subscription growth.
Uber acquired Delivery Hero for an equity value of USD 14.8 billion.
The deal creates a platform spanning 99 countries with a pro-forma gross merchandise value of USD 236 billion in 2025.
Delivery Hero will sell operations in 14 markets to SSW Partners for approximately USD 1.605 billion to address antitrust concerns.
Prosus, a major shareholder, committed to selling its nearly 17 per cent stake in Delivery Hero.
Uber committed to investing USD 2.293 billion in Germany through 2031, maintaining Delivery Hero's Berlin headquarters and workforce until at least 2029.
Source: Reuters
