“It (the deal) will definitely be scrutinized but I think it will pass. Grubhub and its subsidiaries took in 28% of the sales, according to the data. Meal delivery services saw year-over-year growth of 24%, through the end of March in the United States, with Uber Eats taking in about 20% of consumers’ meal delivery sales, data from analytics firm Second Measure showed. Uber in January sold its Indian food business to local rival Zomato and earlier this month closed Eats operations in eight countries. UberEats, which offers food delivery services in more than 6,000 cities worldwide, has been a drag on the company’s bottom line since its inception in 2014. The approach comes as revenue from Uber’s restaurant food delivery business, Uber Eats, surged more than 50% to $819 million on a yearly basis in the recently reported first quarter as restrictions imposed to curb the coronavirus forced eateries to shut their dining areas. Uber said it does not comment on rumors and speculations, while GrubHub declined to comment. GrubHub had a market capitalization of about $4.3 billion, while Uber was valued at nearly $55 billion as of Monday’s close, according to Refinitiv data. Shares of GrubHub jumped about 29% to $60.50, while those of Uber rose 6%. The two companies could reach an agreement as soon as this month, Bloomberg News reported earlier on Tuesday, citing people familiar with the matter. That makes Grubhub particularly attractive to Uber now, Forte said, but it also makes it more likely that Grubhub will hold out for a better price or remain independent.(Reuters) – Uber Technologies Inc is in advanced talks to buy online food delivery company GrubHub Inc in an all-stock deal, according to a person familiar with the matter. Tom Forte, an analyst with Davidson, said the pandemic will likely expand the size of the food delivery market, perhaps permanently. Grubhub's first-quarter revenue rose 12% to $363 million, but it reported a net loss of $33.4 million. Uber said last week that revenue in its Uber Eats meal delivery business grew 53% to $819 million in the first quarter, but it reported a $313 million adjusted loss for the division. The companies have also waived fees for struggling restaurants during the pandemic. “Clearly this would be an aggressive move by Uber to take out a major competitor on the Uber Eats front and further consolidate its market share position, especially as the COVID-19 pandemic continues to shift more of a focus to deliveries versus ride-sharing in the near term,” Ives wrote in a note to investors.įood delivery companies have had difficulty turning a profit despite rising demand for their service, partly because fierce competition has forced them to offer deals and keep prices low. DoorDash, their chief competitor, controls around 35% of the market. food delivery market, according to Dan Ives, an analyst with Wedbush Securities. Uber and Grubhub declined to comment on the report when contacted by The Associated Press.Ĭombined, Uber Eats and Grubhub would control 55% of the U.S.
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