Uber, Postmates agree on US$2.65 billion all-stock deal
- The takeover of Postmates would help Uber gain ground against DoorDash, the current leader in the US food delivery market
- Founded in 2011, Postmates was one of the first to let customers in the US order meal delivery using a mobile app
Ride-hailing giant Uber Technologies has agreed to acquire food delivery service Postmates in a US$2.65 billion all-stock takeover expected to be announced as soon as Monday morning in the United States, according to people familiar with the matter.
Uber Eats head Pierre-Dimitri Gore-Coty is expected to continue to run San Francisco-based Uber’s combined delivery business, according to a person who asked not to be identified discussing a private deal. Under their agreement, Postmates chief executive Bastian Lehmann and his team will stay on to manage Postmates as a separate service, another person said.
The takeover would help Uber gain ground against privately-held DoorDash, the current market leader in US food delivery. While Postmates has not kept pace with DoorDash, it maintains a strong position in Los Angeles and the American Southwest, both of which could be valuable to Uber Eats.
Representatives for Uber and Postmates declined to comment.
Uber and Postmates had held discussions on and off for about four years, but the talks accelerated about a week ago after Uber approached the latter firm, one of the people said. The move for Postmates comes on the heels of Uber’s failed bid to acquire publicly traded GrubHub, which was scooped up by Europe’s Just Eat Takeaway.com for US$7.3 billion.
Uber’s board of directors has approved the Postmates deal, a person said, though the plans could still be subject to change. Uber closed at US$30.68 on Friday, after it had gone up more than 4 per cent on initial reports of its bid for Postmates.
Founded in 2011, Postmates was one of the first to let customers in the US order meal delivery using a mobile app. Competition, however, has intensified in recent years and Postmates has fallen to a distant fourth. The company said in February last year that it had filed paperwork confidentially for an initial public offering, but never went public. It raised private capital last year in a deal that valued the business at US$2.4 billion.