- Uber is reportedly in discussions to buy Postmates for $2.6 billion and could come to an agreement Monday evening, according to The New York Times, which cited three people familiar with the matter. Uber told Restaurant Dive that it doesn't comment on speculation. Postmates didn't respond to a request for comment by press time.
- At the same time, Postmates is also preparing to make its IPO filing public, potentially trading in late summer, The Wall Street Journal reports, which also cited people familiar with the matter.
- Postmates has also received an offer from a special purpose acquisition company, which could provide another path to becoming public, CNBC reports.
Consolidation has long been expected in the U.S. delivery segment, especially as a way to increase profitability, but when Uber and Grubhub were originally in talks last month to combine operations, the potential deal came under immense antitrust scrutiny. Grubhub eventually merged with European-based Just Eat Takeaway. But Uber doesn’t appear to have lost its acquisition appetite.
The company, which saw revenues decline for its ridesharing business due to the pandemic, has been pushing forward with strategies to bolster its Eats business, and acquisitions would help the company grow as it maintains its strategy to be in the first or second position in each of its markets. Uber Eats is leaving markets where it doesn’t hold these top positions, discontinuing services in eight global markets in June.
If Uber Eats and Postmates were to combine, Uber Eats would have 35% market share based on data from Edison Trends on April market share, securing its spot as the second largest food delivery company in the U.S. behind DoorDash.
While the deal may not come to fruition, Postmates appears to be on the path to becoming public either through a special purpose acquisition company or through an IPO. The company originally filed an IPO confidentially in February 2019, but held off after investors turned away from unprofitable startups like WeWork.
Postmates has struggled to grow nationally even after it entered 1,000 new cities, reaching into 50 states, in April 2019. It only has dominant market share in Los Angeles, according to Second Measure. Going public could help Postmates raise funding to invest in more technology, expand into new markets and bulk up its marketing strategy to help it better compete in the long term.