Doordash to buy Instacart in $17bn deal it says will expand customer options

Doordash has announced a $17 billion acquisition of Instacart, a grocery delivery service. This deal is expected to be finalized within a year and will expand the options available to customers, allowing them to access more stores and services. The combined companies anticipate that Instacart shoppers will gain access to 150,000 stores, up from the current 100,000.

DoorDash CEO Chris Rogers stated that the acquisition will allow the company to leverage Instacart's expertise in grocery selection and substitutions, while Instacart CEO Chris Rogers added that the merger will enable both companies to innovate further in the grocery industry. Grocery delivery is considered challenging due to the need for careful handling of perishable items like avocados and ice cream.

Analyst Martin Szumski noted that the growth in food delivery is shifting towards more frequent, higher-value orders, such as weekly grocery shopping and convenience items. The deal, valued at $65 per share, is DoorDash's largest acquisition to date and could enable the company to compete with delivery giants like Amazon. However, the merger may face antitrust scrutiny from government regulators.

The New York City commission on consumer and worker protections expressed concern over the trend of mega-corporations consolidating, stating that they would enforce delivery workers' rights regardless of the outcome of this merger.