By Ian Walker
Deliveroo shares hit three-year highs after the London-listed food-delivery company said it received a 2.7 billion pounds ($3.59 billion) takeover approach from DoorDash that it would be prepared to recommend to shareholders if a formal offer were made.
Shares were up 23.40 pence, or 16%, at 170.0 pence in early morning European trading, marking their highest price since January 2022. They are currently up 20% over the year to date.
Deliveroo said late Friday that it received an approach from the U.S. company on April 5 to buy the business for 180 pence a share in cash. The price was a 23% premium to Friday's closing price of 146.60 pence.
It said that the board had opened talks with the San Francisco-based company and provided it due diligence access, while cautioning that there's no certainty any deal will be struck.
Morgan Stanley analyst Luke Holbrook says that DoorDash is a natural buyer for Deliveroo given that there are no real geographic overlaps between the two companies. He also notes that investors generally believe the two companies are a good cultural fit.
DoorDash hasn't made any formal statement on the approach. It has until May 23 to make a formal offer or walk away under U.K. Takeover Panel rules.
Deliveroo said Monday that in light of the DoorDash takeover proposal it had suspended its 100 million pound share buyback program announced on March 18.
Write to Ian Walker at ian.walker@wsj.com
(END) Dow Jones Newswires
April 28, 2025 03:37 ET (07:37 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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