DoorDash announced that it has entered into an agreement to acquire Instacart for approximately $17 billion, combining two of the country’s leading delivery platforms as DoorDash looks to expand further into grocery delivery.
Per the agreement announced Thursday, DoorDash will pay $65 per Instacart share, representing a 26% premium over the company’s Oct. 22 closing price. The transaction will be at least 75% cash, with DoorDash stock accounting for no more than 25% of the total consideration.
DoorDash originally focused its business around restaurant delivery but has expanded into grocery and retail. Instacart specializes in grocery delivery and also provides technology to retailers. Reuters described the acquisition as a major push by DoorDash into the U.S. grocery delivery market as competition in the industry grows.
DoorDash says combining the companies would give local retailers access to its delivery services along with Instacart’s grocery, advertising and technology businesses. DoorDash also says the Instacart brand won’t disappear once the acquisition closes; the company plans to retain its brand, app and enterprise technology products. The deal isn’t expected to close until late 2027 or the first half of 2028. Until closing, both companies will remain separate.
DoorDash says eventually DashPass and Instacart+ will be combined under one membership fee. The company estimates that collectively this could save members approximately $100 million in membership fees. Instacart users could also gain access to over 50,000 additional stores, on top of the nearly 100,000 stores already available through Instacart.
Closing of the deal remains subject to regulatory review and Instacart shareholder approval. The deal would mark another step in DoorDash’s expansion beyond restaurant delivery and into retail and grocery, giving the company a larger foothold in the grocery delivery market.
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