📈 Share Surge
Deliveroo's share price rose by 6% to 136p on Wednesday after reports of takeover talks with US rival Doordash. The shares closed the day 1.2% higher, valuing the company at £2.1B. This is a significant change for Deliveroo, which has seen its value fall more than 50% since its stock market debut in March 2021. The company, often referred to as "Flopperoo" by traders due to its disappointing market performance, seems to be on an upward trajectory again.
🤝 Takeover Talks
Doordash expressed interest in acquiring Deliveroo last month, but talks ended without agreement on the deal's value. Reuters reported the news, causing Doordash shares to initially dip before recovering to close 1.25% higher. Analysts at Jefferies believe the failed talks might not be the end, as the strategic and financial logic of a Deliveroo takeover remains strong. They expect similar headlines to re-emerge soon.
📉 Market Performance
Deliveroo thrived during the Covid-19 lockdowns but has struggled post-pandemic as demand for online food delivery declined. Investors are now favoring more profitable businesses, affecting Deliveroo's stock. The company, which collaborates with 180,000 restaurants and retailers and employs 140,000 riders, has seen its market value fluctuate significantly. The current higher interest rates have also contributed to the pressure on Deliveroo shares.
🛒 Major Shareholders
Amazon, which started investing in Deliveroo in 2019, is the largest shareholder with a 13.2% stake. It is followed by DST Global with 7.5%, and Deliveroo's founder CEO Will Shu with 6.5%. Amazon has been speculated as a potential buyer of Deliveroo. However, the company has faced criticism over its treatment of riders, who are paid per delivery and not directly employed. Both Deliveroo and Doordash declined to comment on the takeover talks.
Do you think Deliveroo will find a new buyer?
