Instacart is exploring a sale and has held preliminary talks with Uber and DoorDash, among other potential buyers, The Information reported Friday, citing people familiar with the matter. The grocery delivery company, legally named Maplebear, has been working with an investment bank to weigh its options, according to the report, which said the discussions are ongoing and may not lead to a deal.
Instacart shares closed about 9% higher. Uber fell nearly 3% and DoorDash more than 4%, Reuters reported. Instacart declined to comment to Reuters, and Uber and DoorDash did not immediately respond.
Instacart has a market value of about $12 billion. The Information said a typical takeover premium of 30% to 40% would value it at roughly $16 billion to $17 billion, based on recent public technology deals. DoorDash held talks to buy Instacart once before, in 2021, in a potential deal that would have valued it at $40 billion to $50 billion, according to The Information.
Two suitors, both listed as rivals
Both reported bidders already appear in Instacart’s latest quarterly 10-Q. The filing names DoorDash and Uber Eats as competitors in ecommerce and fulfillment for retailers, and again in advertising. Uber is also a partner, since restaurants are offered on Instacart’s marketplace “via our partnership with Uber,” the filing says.
Reuters said a takeover could help either buyer in online grocery by pairing Instacart’s marketplace and retailer relationships with the buyer’s own delivery network and customers. DoorDash CEO Tony Xu has separately argued that AI agents will mean more demand for physical delivery.
Instacart also sells software and ads to grocers and brands. It works with more than 2,200 retail banners covering nearly 100,000 stores, and in the second quarter its advertising and other revenue rose 16% to $297 million, ahead of the 14% rise in gross transaction value to $10.35 billion, the company said in August. Retailers also pay for Storefront Pro ecommerce sites and Caper smart carts, which Morrisons now uses in the U.K. Stew Leonard’s and Woodman’s signed on for its AI software in the quarter. CEO Chris Rogers said the company aims to “accelerate adoption of our enterprise technologies with retailers.”
Instacart earned $111 million on $1.043 billion in revenue in the quarter. It generated $480 million in free cash flow and spent $325 million buying back stock.
Uber’s Delivery Hero offer is still open
Uber’s July offer for Germany’s Delivery Hero values that company’s equity at $14.8 billion and would extend Uber’s platform to 99 markets. Reuters said either Instacart deal could draw antitrust scrutiny and would add to a wave of consolidation in food delivery.
The acceptance period for Delivery Hero shareholders ends Nov. 5 at 6 p.m. New York time. Instacart reports third-quarter results after the market closes that same day, with a call at 5 p.m. ET.
Instacart Has Held Early Sale Talks With Uber and DoorDash, Report Says first appeared on Web and IT News.