**Uber Launches $14.8 Billion Takeover Bid for Delivery Hero**
In a significant move within the food delivery sector, Uber Technologies Inc. has initiated a takeover bid for the German company Delivery Hero, valuing the firm at approximately $14.8 billion. This acquisition, announced on Thursday, is set to create the largest food delivery group outside of China, as competition intensifies among rivals in both the U.S. and European markets.
The deal is part of Uber's strategy to expand its global food delivery services through its Uber Eats platform. The company faces increasing competition from rivals such as Just Eat, which is owned by Dutch group Prosus, and U.S.-based DoorDash, which has been rapidly expanding its market presence.
According to Delivery Hero, the proposed acquisition would result in a combined platform operating in 99 countries, with a projected gross merchandise value (GMV) of $236 billion by 2025. For context, China's Meituan reported a GMV of approximately 1.67 trillion yuan (around $246.5 billion) last year.
Uber's CEO, Dara Khosrowshahi, emphasized the potential benefits of the merger, stating that it would nearly double the number of markets where both mobility and delivery services are offered. The objective of the acquisition is to enhance long-term value for both customers and shareholders.
The takeover bid is conditional upon securing a minimum acceptance threshold of 50 percent plus one share. Delivery Hero's management and supervisory board have expressed support for the acquisition, which is expected to be finalized in the latter half of next year.
Uber's offer of €41.50 per share represents a significant premium of approximately 34 percent over Delivery Hero's average share price over the past three months and is about 9 percent higher than the company's closing price on Wednesday. Following the announcement, shares in Delivery Hero initially rose by 5.7 percent in premarket trading but later experienced fluctuations, reflecting the complexities surrounding the deal.
The acquisition would enhance Uber Eats' footprint across Europe, the Middle East, Asia, and Latin America. However, it is anticipated that the deal will attract scrutiny from antitrust regulators due to the overlap in the companies' operations in various markets.
In an effort to facilitate regulatory approval, Delivery Hero has agreed to divest parts of its business in 14 markets to U.S.-based investment firm SSW Partners for around €1.4 billion. Additionally, major shareholder Prosus has consented to sell its stake of just under 17 percent, which could limit the potential for other bidders to emerge or for shareholders to demand a higher price.
Analysts from Jefferies have indicated that the timeline for the deal's completion could suggest a lengthy regulatory review process. They noted that while the involvement of a financial investor might help address antitrust concerns, the anticipated timeline for completion in the second half of 2027 indicates that the review will not be straightforward.
Delivery Hero, which operates several well-known brands including foodpanda, Talabat, Glovo, and PedidosYa, has experienced substantial growth, with its shares rising approximately 62 percent this year. The company had previously disclosed a takeover proposal from Uber in late May, which was valued at around €10 billion, or €33 per share, but was deemed insufficient by Delivery Hero.
Kristin Skogen Lund, Chair of Delivery Hero's Supervisory Board, stated that partnering with a strong entity like Uber is essential for securing the company's future competitiveness in a highly competitive sector. Founded in Berlin in 2011, Delivery Hero has grown rapidly through acquisitions, although it has also retreated from certain markets in response to investor pressures to focus on profitability.
Uber has been actively pursuing acquisitions to bolster its growth following a surge during the pandemic, including its purchase of U.S. food delivery service Postmates for $2.65 billion in 2020. The company has also committed to investing €2 billion in Germany through 2031 and has agreed to maintain Delivery Hero's Berlin headquarters and workforce until at least 2029.
As the food delivery landscape continues to evolve, the outcome of Uber's bid for Delivery Hero will be closely watched by industry stakeholders and regulators alike.