Uber Technologies has agreed to buy US food delivery firm Postmates for US$2.65bn.
Uber said Postmates is highly complementary to Uber Eats, with differentiated geographic focus areas and customer demographics, and Postmates’ strong relationships with small and medium-sized restaurants.
It said Postmates has been an early pioneer of “delivery-as-a-service”, which complements Uber’s growing efforts in the delivery of groceries, essentials, and other goods.
For restaurants and merchants, Postmates and Uber Eats will together offer more tools and technology to more easily and cost-effectively connect with a bigger consumer base.
Consumers will benefit from expanded choice across a wider range of restaurants and other merchants.
Following the closing of the transaction, Uber intends to keep the consumer-facing Postmates app running separately, supported by a more efficient, combined merchant and delivery network.
Uber CEO Dara Khosrowshahi commented: “Uber and Postmates have long shared a belief that platforms like ours can power much more than just food delivery—they can be a hugely important part of local commerce and communities, all the more important during crises like COVID-19.
“As more people and more restaurants have come to use our services, Q2 bookings on Uber Eats are up more than 100 percent year on year. We’re thrilled to welcome Postmates to the Uber family as we innovate together to deliver better experiences for consumers, delivery people, and merchants across the country.”
Postmates co-founder and CEO Bastian Lehmann added: “Over the past eight years we have been focused on a single mission: enable anyone to have anything delivered to them on-demand. Joining forces with Uber will continue that mission as we continue to build Postmates while creating an even stronger platform that brings this mission to life for our customers.
“Uber and Postmates have been strong allies working together to advocate and create the best practices across our industry, especially for our couriers. Together we can ensure that as our industry continues to grow, it will do so for the benefit of everyone in the communities we serve,” said.
The all share deal will see Uber issue approximately 84 million shares of common stock for 100% of the fully diluted equity of Postmates.
The boards of directors of both companies have approved the transaction, and stockholders representing a majority of Postmates’ outstanding shares have committed to support the transaction.
The transaction is subject to the approval of Postmates stockholders, regulatory approval and other customary closing conditions and is expected to close in the first quarter of 2021.
The deal follows Uber missing out on acquiring Grubhub, instead was bought by Just Eat Takeaway.com.
On the markets this morning, the FTSE 100 has opened down 1% to 6,223.2pts.
Risers so far include Hotel Chocolat, up 2.7% to 308p, Devro, up 1.5% to 154.3p and McBride, up 1.1% to 62.1p.
Fallers include Science in Sport, down 4.5% to 31p, Marston’s, down 3.9% to 52p and Compass Group, down 2.8% to 1,147.5p.
Yesterday in the City
The FTSE 100 started the week on the front foot, rising 2.1% to 6,285.9pts, boosted by the prospect of more financial support from the government to mitigate the effects of the coronavirus outbreak.
A number of major multinational fmcg companies were amongst yesterday’s risers, including Just Eat Takeaway.com, up 2.8% to 8,840p, Coca-Cola European Partners, up 2.5% to $34.45, Diageo, up 2.5% to 2,758p, Compass Group, up 2.5% to 1,181p and British American Tobacco, up 2.3% to 3131.5p.
Other risers included AG Barr, up 3.5% to 470.5p, FeverTree, up 3.4% to 2,274p and Carr’s Group, up 3% to 111p.
Fallers included Hotel Chocolat, down 2.6% to 300p, Greggs, down 2.6% to 1,632p, Devro, down 2.4% to 152p, Greencore, down 2.3% to 120.8p and Cranswick, down 2.3% to 3,654p.