Delivery merger: DoorDash acquires Instacart for $17 billion

Instacart shareholders will receive $65 per share in a transaction valued at approximately $17 billion. DoorDash announced the purchase of its grocery delivery rival on Thursday. The offer represents a 25% premium to Instacart's closing price on October 22. That date coincided with media reports suggesting the company was considering a sale.

The acquisition ends Instacart's status as an independent public company. It went public in 2023 after a pandemic-driven surge in demand. Since then, it has faced stiff competition from larger players like Uber, Amazon, and Walmart. Amazon now offers same-day grocery delivery at 2,300 locations. Walmart provides 30-minute delivery in select areas. Uber recently signed a partnership with Costco.

DoorDash stated that the combined entity will merge its delivery network with Instacart's grocery fulfillment technology. The company aims to serve grocers and retailers of all sizes. DoorDash has already expanded beyond meal delivery to include restaurant reservations and products from partners like Home Depot and Sephora. This move adds a deeper grocery component to its portfolio.

Tony Xu, DoorDash's cofounder and CEO, emphasized the difficulty of online grocery shopping. He noted that workers must select ripe produce, find suitable substitutes, and deliver perishable items like ice cream before they melt. He said Instacart has years of experience in this area, while DoorDash possesses a robust local delivery network. The merger intends to provide stores with more tools to unlock the potential of grocery delivery.

The deal is structured as a mix of cash and stock. The companies claim the merger will eliminate the need for separate membership subscriptions. Customers will no longer need to pay for both DashPass and Instacart+. DoorDash estimates this change could save consumers $100 million annually in membership fees.

Critics have already voiced opposition. The American Economic Liberties Project, an anti-monopoly group, is urging regulators to block the deal. The group argues the merger would give the new company nearly 60% control of the third-party grocery delivery market. Lee Hepner, a senior legal counsel at the group, called the merger a form of data-driven abuse that squeezes worker compensation.

The transaction is expected to close within the coming months. It joins a series of recent consolidations in the delivery sector. Grubhub sold its US business to Wonder for $650 million in 2025. Uber purchased the European firm Delivery Hero for $14.8 billion this summer. Previously, Uber bought Postmates for $2.65 billion in 2020.