DoorDash and Instacart announced on October 29 that they have signed a definitive agreement under which DoorDash will acquire Instacart for $65.00 per share, an equity value of roughly $17 billion. The offer represents a 26 percent premium over Instacart closing price on October 22, the last trading day before media reports about a possible transaction. Instacart board of directors unanimously approved the agreement, and stockholders holding about 19 percent of the company outstanding shares have already agreed to vote in favor of the deal.
Under the terms, Instacart stockholders may elect to receive cash, DoorDash stock, or a combination of both, subject to proration so that DoorDash stock does not exceed 25 percent of the aggregate consideration. The cash portion is expected to be funded from cash on hand and debt financing, supported by a 364-day senior unsecured bridge loan facility committed by JPMorgan Chase. The transaction is not subject to a financing condition, and DoorDash says it is targeting a capital structure that maintains investment-grade ratings.
The companies expect the merger to close at the end of 2027 or in the first half of 2028, pending approval by Instacart stockholders, the expiration of the waiting period under United States antitrust law, and other regulatory approvals in Canada and Israel. Termination fee provisions in the agreement call for Instacart to pay $650 million in certain circumstances and for DoorDash to pay $1.25 billion in antitrust-related termination scenarios.
Executives framed the deal as a response to the scale of the largest retailers. DoorDash co-founder and chief executive Tony Xu said in a statement that grocery is one of the hardest things to get right online, noting that someone has to pick a ripe avocado, choose a substitute the customer would pick, and get the ice cream to the door before it melts. Instacart has spent years learning to do that well for grocers, he said, while DoorDash has built a delivery network and technology that local stores rely on every day. On a conference call with investors, Xu argued that the biggest online retailers and grocers have invested aggressively in modern technology stacks, fast delivery, and new fulfillment models, which is why the largest companies keep taking a bigger share of the pie. The combination, he said, gives every retailer a fighting chance in the modern era.
Instacart chief executive Chris Rogers said the past 14 years have transformed online grocery by helping retailers of all sizes compete and grow, and that joining forces with DoorDash allows the company to do even more for retail and brand partners. Apoorva Mehta, who founded Instacart and stepped down after its 2023 initial public offering, said he and Xu had discussed combining the companies for years because the industrial logic was always clear.
Both companies reported solid third-quarter numbers ahead of the announcement. DoorDash revenue grew 34 percent year over year to $4.62 billion in the third quarter, with total orders up 28 percent and GAAP earnings of $1.06 per share, above consensus expectations. Instacart called the quarter its best as a public company, with gross transaction value of $10.53 billion, up 15 percent, total revenue of $1.095 billion, up 17 percent, and advertising and other revenue of $331 million, up 23 percent. Adjusted EBITDA rose 23 percent to $342 million. In light of the deal, Instacart canceled its earnings call and suspended its financial guidance.
Market research firm Consumer Edge said DoorDash accounted for 59 percent of spending across major United States delivery apps in the third quarter of 2026, up from 44 percent in the second quarter of 2021, while Instacart share fell from 26 percent to about 18 percent over the same period. DoorDash already handled about two-thirds of United States food delivery volume. The companies say the combined platform would give Instacart customers access to more than 50,000 additional stores on top of the nearly 100,000 on the platform today, and that merging DashPass and Instacart memberships into one fee could save members an estimated $100 million a year.
Analysts are divided on the regulatory outlook. Rosenblatt Securities analyst Scott Devitt said the expected closing timeline implies a long regulatory path, potentially longer than the roughly 12-to-20-month horizon the companies describe. Bernstein analyst Nikhil Devnani argued the antitrust question will come down to market definition: the companies hold only about 3.5 percent of the overall grocery market, he said, but an estimated 23 percent of online grocery, roughly 34 percent of pure-play online grocery, and as much as 88 percent of third-party online marketplaces. Wedbush analysts, by contrast, said the deal is unlikely to encounter much resistance given the scale of Walmart and Amazon, the two main rivals. PitchBook senior foodtech analyst Alex Frederick said the merger is a bet that the next phase of United States delivery will be won on the weekly grocery order rather than the takeout order, and that few venture-backed challengers remain after global venture investment in online grocers fell from $20.3 billion in 2021 to $566 million through the third quarter of 2026.
Regulatory pressure is already visible. On the same day the deal was announced, the Federal Trade Commission ordered DoorDash, Instacart, Uber, and several other companies to turn over information about their use of personal data to set prices for consumers and pay workers. FTC chairman Andrew Ferguson said consumers deserve to know whether companies use web-surfing habits or other personal data to estimate the highest price each consumer can be charged. The commission reached a $60 million settlement with Instacart in December 2025 over allegations of deceptive advertising and subscription practices, which the company denied. Advocacy groups are opposing the combination: Groundwork Collaborative chief executive Lindsay Owens called DoorDash and Instacart two of the biggest rip-off machines in America and urged the FTC to block the merger, while the American Economic Liberties Project warned of a food delivery monopoly and wage pressure on the roughly nine million gig workers across both platforms. Oliver Wyman partner Randall Sargent summarized the broader worry: less competition and more consolidation tends to be worse for consumers.
Until closing, expected in late 2027 or early 2028, the two companies will operate as separate entities, and DoorDash says it plans to maintain the Instacart brand, technology, and app after the deal closes.
