DoorDash has agreed to acquire Instacart operator Maplebear Inc. for about $17 billion, bringing two major US delivery platforms under one corporate group. The transaction combines DoorDash’s restaurant delivery network with Instacart’s grocery technology and retailer relationships.
Under the agreement, approved unanimously by the Instacart board, DoorDash will pay $65 per share. The offer represents a 26% premium over Instacart’s October 22 closing price. At least 75% of the consideration will be paid in cash, while the remaining portion can be settled through DoorDash shares.
The proposed acquisition is expected to close towards the end of 2027 or during the first half of 2028. It remains subject to approval from Instacart shareholders and regulatory authorities in the US, Canada and Israel.
Deal Faces Regulatory Review
DoorDash has secured a financing commitment from JPMorgan Chase Bank for a 364-day bridge loan to support the transaction. The financing remains subject to customary conditions.
Shareholders representing about 19% of Instacart shares have already agreed to vote in favour of the deal. Until the transaction receives all required approvals and closes, DoorDash and Instacart will continue operating as separate companies.
DoorDash has said it plans to retain the Instacart brand, app and enterprise technology products after the acquisition. The companies have also said the combination will not make grocery services exclusive to DoorDash.
Grocery Network Expands
A key part of the proposed deal is the combination of Instacart’s grocery infrastructure with DoorDash delivery capacity. DoorDash said Instacart customers could eventually gain access to more than 50,000 additional stores, alongside the nearly 100,000 stores currently available on Instacart.
The companies also plan to combine their membership programmes. DashPass and Instacart+ members would be able to use a single membership, with the companies estimating annual savings of about $100 million for customers.
For grocery retailers, the companies said the combined platform could provide technology for running online stores and retail media networks while also adding delivery capacity through DoorDash fulfilment services.
Companies Target Local Retail
DoorDash said the proposed combination could help smaller and local retailers compete with large online retailers and grocery chains. Instacart already provides technology that allows grocery businesses to operate digital storefronts and manage online orders.
Tony Xu, co-founder and CEO of DoorDash, said, “When more people shop local, more dollars stay local.”
Instacart CEO Chris Rogers said combining the company grocery technology and retailer relationships with DoorDash reach and logistics could create new opportunities for retailers and brands. The companies have not described the transaction as a move towards grocery exclusivity.
DoorDash Enters Grocery
The proposed acquisition also gives DoorDash a larger position in grocery delivery, an area where competition has grown among delivery companies, retailers and technology platforms. Instacart brings an established grocery-focused network, while DoorDash contributes a wider on-demand delivery operation.
The deal follows reports that Instacart had recently held discussions with potential buyers, including Uber. DoorDash and Instacart had also discussed a possible transaction in 2021, according to earlier reports.
Antitrust scrutiny is likely to be one of the key issues before the deal can close. The Information had reported that competition concerns were among the factors involved in earlier discussions between the two companies.
What is DoorDash
DoorDash is a US-based on-demand delivery company founded in 2013 by Tony Xu, Stanley Tang, Andy Fang and Evan Moore. The company started with food delivery and expanded into grocery, convenience, retail and other local delivery services. Its business model connects consumers with merchants and delivery workers through its digital platform, generating revenue from delivery-related fees, merchant services, memberships and advertising.
The company has expanded beyond restaurant delivery as demand for local commerce services has grown. Its proposed acquisition of Instacart would give it a much stronger position in online grocery while adding Instacart technology and retailer relationships to its existing delivery infrastructure.
The transaction will now move into the shareholder and regulatory approval process. Its final outcome will depend not only on those approvals but also on how regulators assess competition in the increasingly consolidated US food, grocery and local delivery market.
