By Sohaib Shams
DoorDash has agreed to acquire grocery delivery company Instacart in a $17 billion deal that the companies say will expand options for customers and sellers. The acquisition, expected to close by the end of 2027 or early 2028, will combine DoorDash's restaurant delivery network with Instacart's grocery selection and substitution expertise.
Deal terms
DoorDash will pay $65 per share for Instacart, a 26% premium over the stock's closing price on October 22 before merger talks emerged. The transaction will be at least 75% cash, and DoorDash plans to keep Instacart's brand, app, and technology products. Both services will operate independently until the deal is finalized.
Executive perspectives
Instacart CEO Chris Rogers said the merger would accelerate innovation in online grocery and make it more seamless and affordable for millions of households. DoorDash co-founder and CEO Tony Xu highlighted the difficulty of getting grocery delivery right, noting Instacart's years of experience in picking ripe produce and managing substitutions, while DoorDash has built a delivery network that local stores rely on daily.
Market context
Morningstar analyst Martin Szumski told Reuters that growth in food delivery is shifting from restaurant orders to more frequent, higher-value grocery and retail orders. The deal could help DoorDash compete with larger rivals such as Amazon.
Regulatory scrutiny
The merger may face antitrust review from government regulators. New York City's commission on consumer and worker protections, which recently settled with DoorDash over alleged underpayment of workers, called the deal part of a troubling trend of mega-corporation consolidation and vowed to enforce delivery workers' rights regardless of the outcome.
