DoorDash agrees to buy Instacart in big merger of delivery businesses

DoorDash has agreed to buy Instacart for $17 billion in a big consolidation of the grocery delivery business.

DoorDash will pay $65 per share for Instacart and said the acquisition will benefit communities by enabling more supermarkets to use Instacart's platform to run their websites.

"Instacart has spent years learning to do that well for grocers, while DoorDash has built a delivery network and technology that local stores rely on every day," DoorDash co-founder and CEO Tony Xu said in a statement. "Together, we could give stores of every size more of those tools and unlock the potential of grocery delivery."

DoorDash said the Instacart brand name and app will remain, and Instacart shoppers can continue fulfilling orders for Instacart. Grocers can also choose to work with Instacart or DoorDash. Instacart customers will now have access to 50,000 additional stores covered by DoorDash, the company said.

Instacart, founded in 2012, specializes in grocery and convenience store delivery in the U.S. and Canada. Its 600,000 “shoppers” — who are independent contractors — completed 338 million orders last year, according to company filings. Instacart has a market value of $14 billion.

More to follow...