SAN FRANCISCO — DoorDash has reached an agreement to acquire Instacart in a transaction valued at approximately $17 billion.
The purchase price of $65 per share represents a 26% premium to Instacart’s closing price on Oct. 22.
The combined entity would deliver more choices for consumers and more orders for local businesses, according to the companies.
Instacart shoppers will gain access to more than 50,000 additional stores on top of the nearly 100,000 stores on the platform currently. DashPass and Instacart+ members would pay one membership fee instead of two, saving an estimated $100 million on annual membership fees.
Grocers and retailers of every size are expected to benefit from DoorDash’s delivery network and Instacart’s grocery and fulfillment technology, in both apps and on stores’ own websites, in addition to the advertising and artificial intelligence tools offered by each company. Additionally, grocers could add capacity for online orders through DoorDash’s DashMart Fulfillment Services, offering faster and more accurate delivery.
“Grocery is one of the hardest things to get right online,” said Tony Xu, co-founder and chief executive officer of DoorDash. “Someone has to pick a ripe avocado, find a substitute you’d choose yourself, and get the ice cream to you before it melts. Instacart has spent years learning to do that well for grocers, while DoorDash has built a delivery network and technology that local stores rely on every day. Together, we could give stores of every size more of those tools and unlock the potential of grocery delivery. It’s still early innings, but we know that when more people shop local, more dollars stay local.”
Under terms of the agreement, DoorDash will keep Instacart’s brand, enterprise technology products and app. The companies will continue to operate separately until the transaction is finalized.
The deal is expected to close at the end of 2027 or during the first half of 2028 and remains subject to shareholder approval, regulatory approvals and other customary closing conditions.
“Over the last 14 years, Instacart has transformed online grocery by helping retailers of all sizes compete and grow, and joining forces with DoorDash allows us to do even more,” said Chris Rogers, CEO of Instacart. “When our purpose-built grocery technology and trusted retailer and brand relationships are combined with DoorDash’s global consumer reach and logistics capabilities, we can create new opportunities for our retail and brand partners, offer an even better experience for customers and shoppers, and deliver compelling value for our shareholders. Together, we can accelerate innovation across the grocery industry and make online grocery more seamless and affordable for the millions of households we serve.”
DoorDash expects to fund the cash portion of the consideration with cash on hand and proceeds from debt financing. Centerview Partners and J.P. Morgan Securities are acting as financial advisers to DoorDash, and Goldman Sachs & Co. serves as financial adviser to Instacart.
Since its founding in 2013, DoorDash said it has facilitated over 10 billion consumer orders, driven over $230 billion in sales for merchants and expanded to more than 40 countries. Instacart said it has had more than 1.6 billion lifetime orders, a catalog of more than 2 billion items, and more than 10 million daily inventory signals from 100,000 stores across over 2,200 retail banners.
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