By Hamza Faisal — Instacart, the grocery delivery pioneer that became a household name during the pandemic, is exploring a possible sale — and two of its biggest rivals are in the frame. The Information reported on Friday that Instacart has hired an investment bank to evaluate its strategic options and has held preliminary acquisition discussions with DoorDash, while Bloomberg reported separate talks with Uber.
Instacart declined to comment when contacted by Reuters, and Uber and DoorDash did not immediately respond. The discussions are described as early and preliminary, and there is no guarantee they will lead to a deal — but the market moved fast on the news all the same.
Bankers hired, talks held
According to The Information's report, Instacart engaged bankers to review its options and opened talks with DoorDash about a potential takeover. Bloomberg's parallel account added Uber to the list of suitors, though TechCrunch, citing Bloomberg, reported that Uber has since walked away from those discussions. DoorDash remains the live name in the reporting.
A sale would end a 14-year run as an independent company for Instacart, which went public in 2023 and has spent the years since defending its turf against larger, better-capitalised delivery platforms. The company has leaned on its deep retailer relationships and its Instacart+ membership programme, last year lowering the minimum order for free delivery to $10 as rivals pushed into grocery.
A $16 billion question
Instacart shares closed about 9 percent higher on Friday after the reports, with TechCrunch putting the jump at 9.2 percent. The company was worth roughly $12 billion at Thursday's close — more than $13 billion on TechCrunch's reading — and its stock is up about 25 percent so far this year.
A typical takeover premium of 30 to 40 percent would value Instacart at roughly $16 billion to $17 billion, according to the reports. Investors in the would-be buyers were less enthusiastic: Uber shares fell nearly 3 percent on Friday while DoorDash dropped more than 4 percent, a sign the market is pricing in both the cost of a deal and the regulatory fight that would follow it.
Why sell now — and why it may not happen
The strategic logic is straightforward. Instacart is being squeezed from both sides: retailers are building their own digital delivery channels, while DoorDash and Uber Eats keep expanding into grocery and convenience, and Amazon is pushing its Amazon Now service, which promises groceries and essentials in 30 minutes or less.
"Instacart risks getting squeezed between retailers building their own digital channels and larger platforms that can bundle grocery with other services, giving consumers more reasons to keep coming back," eMarketer analyst Zak Stambor said. "For Instacart, a deal could provide the resources and reach to compete more effectively than it could on its own."
But any deal would draw intense antitrust scrutiny. A takeover by either DoorDash or Uber would bulk up two of the biggest food-delivery platforms in the United States and add to a wave of consolidation — in July, Uber struck a nearly $15 billion deal to buy Germany's Delivery Hero. For now, the talks are just that: talks. Whether they harden into a bid, and whether regulators would ever let one through, is the next question.
