DoorDash Strikes $17B Deal to Acquire Instacart

DoorDash has agreed to acquire Instacart in a transaction valuing its equity at approximately $17 billion, combining the delivery company’s logistics network with Instacart’s grocery technology and retailer relationships.

The agreement values Instacart at $65 a share, a 26% premium to its Oct. 22 closing price, the last trading day before reports of a possible transaction.

At least 75% of the aggregate consideration will be cash, with DoorDash shares accounting for no more than 25%. Instacart shareholders can elect cash, stock or a combination, subject to proration.

The choices include $65 in cash, 0.3372 DoorDash shares, or $48.75 in cash plus 0.0843 DoorDash shares for each Instacart share. Stock elections exceeding the transaction’s limit will be prorated.

DoorDash expects to retain Instacart’s brand, app and enterprise technology products after closing.

“Instacart has spent years learning to do that well for grocers, while DoorDash has built a delivery network and technology that local stores rely on every day,” said Tony Xu, DoorDash’s co-founder and CEO.

Instacart CEO Chris Rogers said combining the companies’ capabilities could create opportunities for retail and brand partners while improving the experience for customers and shoppers.

DoorDash plans to finance the cash portion with existing cash and debt. JPMorgan Chase has committed a 364-day senior unsecured bridge facility to support the borrowing. The acquisition is not subject to a financing condition.

The companies expect to complete the transaction in late 2027 or the first half of 2028.

The companies discussed a deal in 2021 that would have valued Instacart at $40 billion to $50 billion. Those talks collapsed partly over antitrust concerns. Instacart had also held talks with Uber, which were no longer active by the time of this deal.