A Deliveroo courier travels along Regent Street, delivering dining in central London during Covid-19 Tier 4 restrictions.
Pietro Recchia | Images SOUP | LightRocket via Getty Images
LONDON – Deliveroo’s food delivery service is trying to raise £ 1 billion ($ 1.4 billion) by selling new shares in its upcoming initial public offering on the London Stock Exchange.
The company announced Monday that some of its existing shareholders will also sell some of their shares.
Along with Amazon, Deliveroo is also supported by investors, including Durable Capital Partners, Fidelity, T. Rowe Price, General Catalyst, Index Ventures and Accel.
Deliveroo also intends to offer £ 50 million to its customers.
Some early Deliveroo supporters will get a 60,000% return on investment, according to a report on the media site Sifted on Monday.
Deliveroo was valued at $ 7 billion in July, when it raised another $ 180 million from investors. Reports suggested it could be valued at about $ 10 billion following the IPO.
Goldman Sachs and JP Morgan Cazenove have been appointed joint global coordinators for the IPO. A date when the initial public offering was not officially announced, but will probably be in the coming weeks.
A filing last week included details on the structure of Deliveroo’s dual-class shares, which will see Deliveroo CEO Will Shu get 20 votes per share, while all other shareholders will be entitled to only one vote per share.
Last week, the company also revealed that it had a loss of 223.7 million pounds in 2020. Losses are substantially lower in 2020 than in 2019, however, when the London-based company recorded a loss of £ 317 million.
While the eight-year-old company is still in the red, its revenues rose to 4.1 billion pounds in 2020, up from 2.5 billion pounds in 2019.
Deliveroo’s return
Deliveroo went from near failure in 2020, amid a review of competition in Amazon’s minority investments, to an operating profit at the end of the year due to increased demand for online retrieval services caused by coronavirus blockage.
Today, Deliveroo claims to have more than 115,000 food merchants, 100,000 restaurants and millions of consumers in 12 countries. The filing shows that six million orders are placed on Deliveroo each month.
Amazon backed Deliveroo in May 2019, leading a $ 575 million round of financing in exchange for a 16% stake in the business.
In July 2019, the UK antitrust regulator, the Competition and Markets Authority, argued that Deliveroo’s cash injection from Amazon could reduce competition by eliminating the possibility of the e-commerce giant re-entering the market, while Deliveroo could “cease to be distinct. “He froze the investment for almost a year while investigating.
To the disappointment of rivals Just Eat and Domino’s Pizza, the deal was approved by the CMA in August, after Deliveroo said it could give up business without capital.
As interest in the food delivery market continues to grow, UBS analysts have named seven stocks in the sector that will grow by up to 30%.
People who order takeovers more frequently – and spend more when they do so – mean the sector could reach nearly $ 400 billion by 2024, the bank said. Meanwhile, an estimate by Euromonitor said it could be worth $ 1 trillion over the next decade.
– Additional reporting by CNBC’s Ryan Browne.