British Food Delivery Firm Deliveroo’s Stock Soars on DoorDash Acquisition Offer

Shares of Deliveroo soared in London trading Monday after the British food delivery firm said it had received an “indicative proposal” from DoorDash (DASH) to be acquired for 180 pence ($2.40) a share, or roughly 2.72 billion pounds ($3.63 billion).

Deliveroo shares surged 17% in London to 171.9 pence. Shares of DoorDash, which has until 5 p.m. London time May 23 to “announce a firm intention to make an offer,” are little changed in premarket trading.

Deliveroo said it received the proposal on April 5 and that its board indicated to the U.S. company that “should a firm offer be made” at those terms, it “would be minded to recommend such an offer to Deliveroo shareholders.”

Citi analysts on Monday affirmed their “buy” rating on DoorDash stock after the proposed takeover of Deliveroo, saying that the U.K. firm “meets several of DASH’s M&A criteria,” including expanding its geographic reach as well as total addressable market. The U.S. company would need time if it were to expand organically while delivering long-term free cash flow, they said.

Deliveroo, which was established in 2013 and is headquartered in London, operates across nine markets, including France, Ireland, and Singapore.