DoorDash To Enter European Market With $8 Billion Deal For Wolt

DoorDash Inc mentioned on Tuesday it could purchase Finland-based rival Wolt Enterprises OY in an all-stock deal valued at about 7 billion euros ($8.09 billion), as the largest U.S. meals supply expands into Europe.

Demand for companies supplied by DoorDash and rivals boomed in the course of the pandemic. That lofty development charges are more likely to ease as extra individuals step out, setting off a wave of consolidation within the sector.

DoorDash’s shares rose 8% in after-market buying and selling on the acquisition that helps the corporate enter 22 extra markets, together with Germany, Serbia, Croatia, Denmark and Sweden, in addition to a beat on third-quarter income. Wolt, since its first supply in Helsinki, Finland, in 2015, has grown to increase in Europe and Asia and has over 30,000 restaurant and retail companions.

“Joining forces with Wolt will … enable us to speed up our worldwide development, whereas elevating our give attention to the U.S.,” DoorDash Chief Executive Tony Xu said in a statement.

U.S.-based Grubhub Inc’s acquisition by Dutch company Just Eat Takeaway.com and Uber Inc’s purchase of Postmates Inc are among some other big deals in the delivery business.

Wolt and DoorDash said they expect combined adjusted core earnings to be between breakeven and $500 million in 2022, with the deal expected to close in the first half of next year.

Wolt Chief Executive Miki Kuusi will run DoorDash’s international division, reporting to Tony Xu.

DoorDash equity issued as part of the deal will be valued at $206.45 per share, the companies said.

Separately, DoorDash said its third-quarter revenue rose 45% to $1.28 billion, topping estimates of $1.18 billion, according to Refinitiv IBES.

The company however, reported a per-share loss of 30 cents, while analysts had expected a 26-cent loss.

($1 = 0.8655 euros)