DoorDash's $3.9 Billion Acquisition of Deliveroo Nears EU Approval, Analysts Predict 14.66% Upside

DoorDash plans to acquire Deliveroo for $3.9 billion, expanding its footprint in over 40 countries. Analysts provide an average price target of $290.47, suggesting a 14.66% upside. GuruFocus rates the GF Value of DoorDash at $165.78, indicating a possible 34.56% downside. The acquisition aims to fortify DoorDash's global presence and market share.

DoorDash, the leading U.S. food delivery service, is poised to finalize its $3.9 billion acquisition of Deliveroo under the European Union's simplified merger procedure. The acquisition, valued at approximately £2.9 billion (around $3.92 billion), represents a significant milestone for DoorDash in its expansion into the European market [1].

The simplified merger procedure of the EU is adopted for mergers and acquisitions that are not expected to raise significant competition concerns. This process allows for a faster review and imposes a lower information burden on the merging parties [1]. The European Commission has indicated that it does not foresee any major issues with the deal, suggesting a smooth path to regulatory approval.

Deliveroo, a UK-based online food delivery company, has a strong presence in the UK and Europe, with operations in nine countries [2]. The acquisition will expand DoorDash's footprint in the UK and other European markets, enhancing its reach and customer base. DoorDash's recent financial filings indicate strong revenue growth, with total revenue of approximately $11.9 billion for the fiscal year ended June 30, 2025 [3].

Deliveroo's stock has fallen sharply since its 2021 debut due to the contraction in demand for online food delivery post-COVID pandemic. Despite this, the company's digital platform connecting customers to restaurants and delivery riders/couriers continues to be a key asset [1]. The acquisition of Deliveroo by DoorDash is expected to be completed soon, pending regulatory approval. The deal combines DoorDash's technological expertise with Deliveroo's European/Asian operations, targeting cost synergies and cross-border growth [3].

The combined entity will serve 50 million monthly active users across 40+ countries, creating a platform with access to over 1 billion people. The strategic rationale behind the acquisition is to bridge the gap between DoorDash's U.S.-centric operations and Deliveroo's entrenched presence in Europe and Asia [3]. The merger's success will hinge on DoorDash's ability to integrate Deliveroo's operations without diluting its value proposition. The combined entity's gross transaction value (GTV) of $90 billion in 2024 is impressive, but the sector's profitability remains elusive [3].

Analysts provide an average price target of $290.47 for DoorDash, suggesting a 14.66% upside. GuruFocus rates the GF Value of DoorDash at $165.78, indicating a possible 34.56% downside. Investors should monitor the regulatory timeline and the combined entity's integration progress. A successful execution could justify the premium, but patience is key. Consider hedging with short-term volatility in DoorDash's stock or exploring long-term call options if the deal closes without major hurdles [3].

References:
[1] https://brusselsmorning.com/doordashs-3-9bn-deliveroo-acquisition-faces-an-eu-simplified-review-merger-process/77683/
[2] https://www.reuters.com/sustainability/boards-policy-regulation/doordashs-planned-takeover-deliveroo-be-reviewed-under-eus-simplified-merger-2025-08-19/
[3] https://www.ainvest.com/news/strategic-rationale-investment-implications-doordash-takeover-deliveroo-2508/