DoorDash to Acquire Instacart for $17 Billion

On Thursday, DoorDash announced its plans to acquire Instacart in a deal valued at approximately $17 billion, marking a significant move into the burgeoning U.S. grocery delivery sector amid intensifying competition among app-based services.

DoorDash has proposed a buying price of $65 per share for Instacart’s shareholders. This offer represents a premium of around 26% compared to the stock’s closing price on October 22 when discussions about the deal first emerged.

As the restaurant delivery sector becomes more mature, delivery companies are increasingly looking to broaden their offerings to include grocery and retail services.

Tony Xu, DoorDash’s co-founder and CEO, highlighted the challenges of online grocery sales, noting that Instacart has invested years in mastering the grocery delivery experience.

There’s a rising demand for grocery deliveries as many consumers, looking to save money, find online shopping convenient—especially now that gas prices are soaring, partly due to disruptions linked to the war in Iran.

However, the market has become quite competitive following the pandemic’s peak, with many companies facing rising costs and regulatory scrutiny regarding the treatment of gig workers. This environment has led to a surge of mergers and acquisitions in the industry.

Recent notable deals include Just Eat Takeaway’s acquisition of Grubhub for $7.3 billion and DoorDash’s deals for Wolt and the UK-based Deliveroo. Uber also made headlines this year with a $15 billion buyout of Delivery Hero, along with Postmates in 2020.

The transaction between DoorDash and Instacart is anticipated to be finalized by the end of 2027 or the first half of 2028.

In a related note, Instacart announced on Monday, through a regulatory filing, that it plans to discontinue its Caper Cart smart shopping-cart initiative by the close of the second quarter of 2027, projecting pre-tax charges of between $55 million and $80 million from this decision.