On Saturday, the online food delivery specialist announced it had been approached by Uber Technologies regarding a potential takeover bid. The American giant made contact with an indicative proposal of €33 per share as part of a potential tender offer targeting all of the company's shareholders.

Following receipt of this offer, Delivery Hero stated it would remain focused on executing its strategic review process.

Just a few days earlier, the company had welcomed Uber Technologies' increased stake, which rose to 19.5%, supplemented by a further 5.6% in the form of options.

According to reports from the Financial Times, the board of Uber Technologies met on Saturday to discuss raising its offer after the initial bid was rejected by a major shareholder.

Several shareholders reportedly told the British media outlet they would seek a price exceeding 40 euros per share for the entire company, representing a 19% premium over Delivery Hero's closing price on Friday. Such a price would value the firm at nearly €13bn.

This move comes amid a wave of market consolidation following DoorDash's acquisition of Deliveroo and Prosus's takeover of Just Eat Takeaway.
In the meal delivery sector, profitability hinges on critical mass, geographic density, and the reduction of marketing costs, explaining the drive among players to acquire competitors.

Jefferies analyzes the situation

The American investment bank explained that "rumors of a takeover and breakup of Delivery Hero by Uber and DoorDash underscore the strategic value of these assets, as well as the complexity of such an acquisition. While the next steps are difficult to predict, Delivery Hero's share price should continue to climb. Shareholder Aspex will likely demand a price well above current levels, while Prosus's influence will be decisive."

As a reminder, Prosus is Delivery Hero's second-largest shareholder behind Uber with approximately 17% of the capital, while Aspex holds around 15%.

Jefferies also noted that DoorDash has made inquiries regarding Delivery Hero, primarily targeting its Middle Eastern operations.

Analysts suggest the primary risks would be a withdrawal by both potential suitors, while regulators could also block the transaction.
The outcome could be complicated by antitrust regulations, as Uber competes with Delivery Hero in 22 markets, including 9 in Europe, while DoorDash competes with Delivery Hero in 18 markets, including 14 in Europe.

Jefferies detailed that a "joint bid aimed at breaking up and sharing the group could bypass these obstacles, but the complexity and risk of failure would remain high."

Jefferies maintains a Buy recommendation on Delivery Hero with a target price of €42.50.