Uber's offer to acquire Grubhub could combine two of the largest food-delivery apps in the U.S. as the coronavirus pandemic boosts demand for such services.
Uber Technologies Inc. has made an offer to acquire Grubhub Inc., a move that could combine two of the largest food-delivery apps in the U.S. as the novel coronavirus — and the stay-at-home orders meant to limit the virus’ spread — drives a surge in demand, according to people familiar with the matter.
On Wednesday, Uber brought a $900-million bond sale. That’s up from a planned $750-million sale, which the company said may be used for acquisitions, among other general corporate purposes. The five-year notes, which can’t be bought back for two years, will yield 7.5%, said people with knowledge of the matter, who asked not to be named discussing a private transaction.S&P Global Ratings grades Uber’s new unsecured notes as CCC+, or seven levels below investment grade.
Food delivery remains largely unprofitable. That dynamic has led to much speculation about potential consolidation in the industry. DoorDash, which is privately held and backed by SoftBank Group Corp., is the most popular in the U.S., followed by Grubhub and Uber. Any merger between the major apps could draw antitrust scrutiny. Together, Uber and Grubhub could account for 55% of the market, according to Wedbush Securities.A deal “would help consolidate the U.S.
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