Uber is pursuing an acquisition of its competitor, Grubhub, with Grubhub recently proposing an all-stock consideration with an exchange rate of 2.15 Uber shares for every Grubhub share.
"If the two combined, Uber Eats and Grubhub would represent ~55% market share in 3P food delivery marking a clear leader in the space... While each have respective market strengths, the overlap in diners, restaurants, and markets should create significant cost-saving opportunities, particularly in sales and marketing expenses, but also in technology, and headcount, which can go a long way in alleviating the gross margin pressure driven by the actual cost to deliver meals.”
Dan Ives, Wedbush Securities analyst
The Uber board is expected to further review the counteroffer proposed by Grubhub in the coming weeks.