Deliveroo's takeover deal by DoorDash undergoes scrutiny via the EU's streamlined merger assessment process
The European Union is currently reviewing DoorDash's planned takeover of Deliveroo, a move that could create a global food delivery giant with a combined gross transaction value of around $90 billion spanning over 40 countries. The deal, valued at approximately £2.9 billion, was reached in May.
The simplified merger procedure, which usually indicates no competition concerns and probable approval, is being used for the review. However, the deal faces challenges, including regulatory scrutiny in the EU and UK, integration difficulties in a low-margin sector, and concerns over potential overpayment given Deliveroo's current valuation and financial losses.
Deliveroo has recently posted a net loss of £19.2 million in the first half of 2025, despite an 8% increase in revenue and order volume. The acquisition will take Deliveroo private, removing it from UK public markets and significantly expanding DoorDash’s global footprint into new markets such as France, Italy, Singapore, the UAE, and the UK.
The stagnation in demand for online food delivery from Deliveroo, a challenge the company is currently facing, is post-Covid related and occurred after the pandemic. This development has contributed to the weakness in Deliveroo's shares, which weakened significantly after its 2021 debut.
If approved, the combination could leverage DoorDash’s technological capabilities and Deliveroo’s local market knowledge to better compete globally. However, the integration risks and financial pressures from Deliveroo’s previous losses create uncertainty about near-term profitability.
In summary, the implications of the deal include the formation of a major global player with complementary geographic and technological strengths, potential for significant cost synergies and market expansion, regulatory oversight focused on competition and consumer impact under the simplified EU merger procedure, short-term financial risks due to Deliveroo’s current losses and acquisition-related costs, strategic repositioning to reshape the food delivery landscape across multiple continents, and the potential for improved global competition.
The EU Commission has documents showing the review of the takeover, and the review under the simplified procedure suggests a likely approval of the takeover. However, the final decision is yet to be made.
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