Uber agrees to buy Delivery Hero in $15 billion deal to expand global food delivery business

Uber has announced an agreement to acquire Germany’s Delivery Hero in a deal valued at nearly 15 billion dollars, marking one of the biggest takeovers in the food delivery industry. The acquisition is expected to create the world’s largest food delivery company outside China and strengthen Uber’s position as competition intensifies among global delivery platforms.

The deal is part of Uber’s long term strategy to expand its food delivery business and compete more effectively with major rivals including DoorDash and Just Eat. By combining their operations, Uber and Delivery Hero will significantly increase their international reach and serve customers across a much larger network of countries.

According to the companies, the combined business will operate in 99 markets worldwide with a projected gross merchandise value of 236 billion dollars in 2025. Uber Chief Executive Dara Khosrowshahi said the acquisition would nearly double the number of countries where the company offers both ride hailing and food delivery services, allowing Uber to strengthen its global platform.

Uber is already the largest shareholder in Delivery Hero and has made the transaction conditional on receiving approval from shareholders representing at least half of the company’s shares plus one additional share. The acquisition has been approved by Delivery Hero’s management and supervisory board and is expected to be completed during the second half of next year.

Under the agreement, Uber will pay 41.50 euros per share, representing a substantial premium over Delivery Hero’s recent average share price. While the company’s stock closed largely unchanged after the announcement, Uber shares rose modestly as investors reacted positively to the deal.

The acquisition will greatly expand Uber Eats across Europe, the Middle East, Asia and Latin America. However, the transaction is expected to face detailed reviews from competition regulators because the combined company would hold a strong position in many markets where both businesses already operate.

To address potential antitrust concerns, Delivery Hero has agreed to sell its operations in 14 markets to the American investment firm SSW Partners for about 1.4 billion euros. In addition, Dutch technology investor Prosus has agreed to sell its nearly 17 percent stake in Delivery Hero, reducing the likelihood of a competing takeover offer.

Market analysts believe the approval process could take considerable time. Experts at Jefferies said the expected completion date suggests regulators will closely examine the transaction before giving final approval. They noted that using a financial investor to purchase some of Delivery Hero’s businesses may help reduce competition concerns, but they still expect a lengthy review.

The deal reflects years of consolidation in the global food delivery industry. During the pandemic, many regional companies expanded rapidly as demand for online food ordering increased. Since then, slower order growth, rising operating costs and greater regulatory scrutiny over gig economy workers have encouraged companies to merge in order to improve profitability and strengthen their market positions.

Over the past few years, Uber acquired Postmates, DoorDash purchased Wolt and Deliveroo, Just Eat merged with Takeaway.com and acquired Grubhub, while Delivery Hero expanded by buying companies including Glovo and foodpanda. The latest agreement further reshapes the industry and leaves Uber and DoorDash as two of the most dominant international players.

Founded in Berlin in 2011, Delivery Hero grew into one of the world’s largest food delivery companies through a series of acquisitions, although it later withdrew from several markets to focus on improving financial performance. The company also owns well known delivery platforms including Talabat and PedidosYa.

As part of the agreement, Uber has pledged to invest two billion euros in Germany by 2031. It has also committed to keeping Delivery Hero’s headquarters in Berlin and maintaining its workforce there until at least 2029. Analysts say the acquisition will give Uber access to around 60 million monthly active users, creating new opportunities to expand its ride hailing services, food delivery business and subscription program across markets where its presence has previously been limited.