NextFin News - Uber Technologies Inc. is exploring a full takeover of Berlin-based Delivery Hero SE, according to people familiar with the matter, a move that would represent one of the most significant consolidations in the global food delivery sector. The discussions, which remain in an early and private stage, follow Uber’s aggressive expansion into European and Asian markets as it seeks to cement its dominance against rivals like DoorDash Inc. and Just Eat Takeaway.com NV.
The potential deal comes just days after Uber significantly increased its stake in Delivery Hero to 19.5%, up from approximately 7% in April. That earlier acquisition involved purchasing €270 million ($318 million) worth of shares from Prosus NV. While Uber previously stated it had no immediate plans for a full takeover, the rapid escalation of its holding and the current internal deliberations suggest a shift in strategy aimed at capturing Delivery Hero’s extensive footprint in Europe, the Middle East, and Southeast Asia.
Giles Thorne, an analyst at Jefferies who has long maintained a bullish outlook on sector consolidation, noted that such a merger would be a logical step for Uber to achieve "unassailable scale." Thorne’s perspective, while influential, reflects a pro-growth stance that may not account for the significant regulatory hurdles a deal of this magnitude would face. According to Jefferies, the integration of Delivery Hero’s logistics network could provide Uber with the density required to turn consistently thin margins into robust profitability. However, this view is currently a minority position among sell-side analysts, many of whom remain cautious about the antitrust implications in the European Union.
Regulatory scrutiny is likely to be the primary obstacle. European competition authorities have grown increasingly wary of "killer acquisitions" and platform monopolies. A full merger would combine two of the largest players in several key markets, potentially triggering forced divestments. Uber has already moved to mitigate some of these concerns by agreeing to buy Delivery Hero’s Foodpanda business in Taiwan for $950 million, a transaction that serves as a precursor to deeper cooperation but also highlights the complexity of disentangling regional operations.
For Delivery Hero, a sale would offer an exit strategy for a company that has struggled with a volatile share price and the persistent pressure to reach sustainable free cash flow. The German firm has been offloading non-core assets for over a year to shore up its balance sheet. While the market reacted positively to the news of Uber’s increased stake, a full takeover bid would require a significant premium over Delivery Hero’s current market valuation, which has been battered by high interest rates and cooling consumer spending in the post-pandemic era.
The financial logic for Uber rests on the "super-app" ambition championed by CEO Dara Khosrowshahi. By folding Delivery Hero’s customers into the Uber One membership program, the company could theoretically lower customer acquisition costs and increase order frequency. Yet, the execution risk is substantial. Integrating disparate technology stacks and managing labor relations across dozens of different legal jurisdictions has historically proven difficult for large-scale delivery mergers. Whether Uber proceeds with a formal offer will likely depend on preliminary feedback from regulators and the stability of its own share price in the coming weeks.
Explore more exclusive insights at nextfin.ai.
